A step-by-step guide to selling your technology business
BDO has created a practical step-by-step guide to assist you in understanding the sale process of your technology business.
The technology industry is one of the fastest evolving industries, often redefining itself every five or so years. Understanding the current market dynamics and value creation prospects remains crucial when preparing for the sale of your technology business.
The sale of your business will likely be one of the most significant financial transactions of your life. As a vendor, you get one opportunity to make an impression on potential investors or acquirers, hence early preparation and planning are critical.
BDO has created a practical step-by-step guide to assist you in understanding the sale process of your technology business. In this guide, we outline:
- How you can prepare your technology business for sale
- The transaction and structured sale process
- The preparation of the information memorandum
- Whether you should approach one buyer or several
- The handling of meetings, offers, and negotiations
- Final offers and letters of intent.
Is your business ready to manage the process?
The sale of a company creates a great demand for information.
An adviser can help coordinate and prepare the information required as part of the sale process – building confidence with prospective buyers.
If you do ultimately decide to sell your business, it can take six to 12 months or more to complete a transaction. During this period, the company must continue to run effectively despite the diversion of your time.
Your management team must therefore be strong enough to cope with the additional demands likely to be placed on it during the sale process.
It’s recommended that the planning process begins well in advance. This will give you time to prepare for tax planning and clean up the company’s balance sheet.
Most buyers usually look at the last three years of the company’s operations so the better shape the company is in, the more likely you can get a better price.
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As such, it’s usually a good idea to start preparing the information that potential purchasers are likely to require well in advance of any sale process. Also, ensuring the information that purchasers will want to review is comprehensive and well organised is essential to the smooth completion of any transaction.
Download the guide
If you are considering selling your technology business, BDO’s team of M&A specialists can help you navigate a wide range of corporate transactions.
To learn more, download the full guide here.
