Most businesses have confidential information, formulas and processes. These are details that must never be seen by competitors. When selling a business, you will come across buyers who are only interested in learning about your secrets. That is why it is very important to protect confidentiality. There are several methods that a business broker 92154 trusts use to maintain confidentiality. Here are the two most dependable methods.
The common mistake sellers make is being too trusting and oversharing. As aforementioned, not every buyer is interested in buying your business. A business broker 92154 knows this and will protect your business’ confidentiality from the get-go. Considering buyers will want to know what they are buying before giving an offer, you will need to provide descriptions of your business which will be used in marketing. For this purpose, business brokers use teaser documents.
The teaser document offers a short description of the business without disclosing its identity. It offers enough information to pique the interest of a potential acquirer. A teaser includes the following:
- Basic description of the business.
- Profile of customers
- Basic information on financials
- Overview of the market opportunity
A teaser doesn’t disclose the name of the business. It is meant to draw the attention of the right buyers. Prior to disclosing any information about the business, the buyer has to prove that they are serious about acquiring the business, sign confidentiality agreements and prove they have the financial muscle.
Another method used to protect confidentiality is the creation of an online data room. After reviewing the teaser document, serious buyers will request more information about the business. After signing an NDA, more detailed information can be presented to them in an online data room.
This step is only available to buyers that have been prescreened and proven to be serious about acquiring your business. In the data room, most of the requested details will be provided. They include the name of the business, sales processes, future plans, and new product development ideas.
Keep in mind that sharing information through the online data room will help interested parties learn about what makes your business unique. Some of the buyers may be your competitors. With some companies only interested in snooping around, you need to work closely with an experienced business broker in San Diego to thoroughly pre-screen buyers before disclosing any sensitive information to them.
Protecting confidentiality is of utmost importance. If confidentiality is breached, you risk losing key employees, suppliers, lenders and even your market advantage. Everything has to be kept a secret throughout the sale. Be mean with information.