25 Years of Disrupting 300 Years of Traditional M&A

February 19, 2018

Excerpt from Our New Book: How to Best Market Your Mid-Size Business For Sale

Just imagine: What would happen to your business if 99% of your target market didn’t know you exist? How could you bring your products and services to market by just letting a few select people know about them? Chances are it’s unlikely your company would prosper.

Woodbridge International approaches selling your business with the same mind-set. We are first and foremost aggressive marketers, who also know how to negotiate fiercely on behalf of our clients. We’ve disrupted the way midsized companies like yours are sold because we want to give our client the greatest number of attractive opportunities when they bring their most valuable asset to market.

M&A is long overdue for disruption

We believe business sellers have been under-served and short-changed by traditional M&A firms. They are structured to sell companies exactly the same way it has been done since the 1700s: via relationships, approaching a small group of buyers, and assigning deals to traditional investment bankers who are under the gun to bring in new business while they serve existing clients. Meanwhile, clients fail to receive the attention they deserve.

Industry specialists (traditional investment bankers) are focused on deals in one or two industries so their habit is to market their sell-side clients only to a few dozen buyers they judge to be suitable. Since traditional investment bankers are tied to a particular industry and its active buyers, it begs the question: Who are they really working for? If the banker has already closed multiple deals with a particular buyer, who are they really loyal to?

Also, since an industry-focused or boutique investment banker will only contact a small number of buyers, when one of these buyers makes an offer that is accepted by the seller, the buyer feels empowered to run the deal. When there isn’t much competition, a traditional investment banker will often permit the buyer to control the deal, fearing he will walk away if he is pushed too hard. This dynamic is bad news for a seller. If the banker becomes sympathetic to the buyer’s issues and timing, the deal will inevitably drag out, and the advantage goes to the buyer. We must focus all parties on getting a deal closed on a closing date deadline. If the buyer is not cooperating we need to move to the next buyer or re-market.

Woodbridge International never allows a buyer to take control of a deal because we don’t have to: creating a global auction protects our clients from ever becoming dependent on a single buyer.