Selling Your Business – Introduction
The call (or more frequently now, an email) comes, the one that most entrepreneurs have received by year two or three of running their business. It generally starts with some variation of “Hello – is this the owner of the business? I represent/own company ABC and I’d like to speak to you about buying or merging with your company.”
But then where does it go? Some entrepreneurs will respond simply with a “No Thanks” and hang up, others will patiently hear out the pitch and politely decline, while a select few will take the option and engage in a discussion.
At Redcap&Truss we have spoken with hundreds of entrepreneurs about the sale of their business. We have found that those who politely decline often do so not because they aren’t interested in selling their business, but more because they aren’t sure of the process, don’t think the timing is right or didn’t think the party was credible. Unfortunately, with that response, they are missing out on an opportunity to learn a little bit about their competition, their standing in the market, or a sales process in general.
To address this, we decided to start this blog to help demystify the sales process for entrepreneurs and to hopefully encourage more owners to at least engage in a bit of a discussion when they get that call. Some topics we will cover will be quite broad while others we will narrow in on a specific facete of a deal (usually because its something we are dealing with on an active assignment). We promise we will keep them relatively short, jargon free (or at least explain the jargon) and brutally honest. We are not going to be able to cover every situation or nuance, but our intent is to arm the reader with enough knowledge about the right questions to ask and the options that they have.
To start this blog out, we thought we should give a little background on Redcap&Truss. We started our business advisory firm in 2014 – a couple of investment bankers (Chris Beaton and Patrick Allan) teaming up with a serial entrepreneur (Kevin Kutschinski) who collectively thought that they could bring “Big Bank Expertise” to the Canadian mid-market (Jargon alert – whenever we reference a word that we think is jargon, we will provide an explanation in the notes below). Not only did we believe that we could bring deep industry contacts and extensive transaction experience to this underserved market, but more fundamentally, we held a strong belief (that has since been proven) that most entrepreneurs didn’t know who to talk to about the potential sale of their business (the sell-side), an acquisition (the buy-side), and even more broadly, they didn’t have anyone to talk to about their strategic business issues generally.
The name Redcap&Truss is inspired by the late 19th-century Red Cap baggage porters in New York’s Grand Central Station. Similar to porters, we carry each sales process from start to finish, while building a bridge (Truss) between buyer and seller.
Since inception, we have closed on 30+ transactions and advising entrepreneurs on the growth and sale of their businesses. We would love to hear your story – please feel free to contact us anytime (we are good with evenings and weekend chats).
 Jargon Alert – mid-market is generally defined as companies with an enterprise value of between $5 million to $100 million