When selling your business, your M&A advisor has multiple roles. Primary, of course, is marketing your business. They negotiate the sale on your behalf, steer the process through due diligence, and ensure everyone is on the same page around key negotiation points.
But your M&A advisor is the quarterback, not the whole team. Your advisor is in charge of ensuring you have the right people around you, including the right attorney, to reach a successful close on your deal.
We’ve always recommended our clients work with an M&A attorney, legal counsel who specializes in business transitions. Lately, though, we’re transitioning more from recommendation to insistence. In fact, we’re adamant.
If you’ve done everything right to maximize the value for your business, and then we’ve done everything right to find a buyer that fits your goals, we don’t want the deal to blow up because your long-time attorney muddied the operation.
It happens. We’ve had deals fall apart because the attorney didn’t know what they didn’t know, or because they got overly aggressive and outside the norms in protecting the seller’s interests. And, on rare occasion, we believe there are even a few bad apples (like every industry) out there who will foil a deal simply because they don’t want to lose your business.
We have this conversation a lot. Most sellers want to bring in the attorney they’ve used for years. Maybe this attorney helped you set up your entity, handled some collection issues, and reviewed your contracts. You know them. You trust them.
But this is no time to choose an attorney simply because you’ve worked with them before. That would be like trusting your general practitioner who does your annual physical with brain surgery. When it’s a matter of life and death, when you only have one shot, you want the very best. You want the specialist who does nothing but brain surgery all day, every day.
And that’s what you want when it’s time to sell your business, too. You typically get one chance to sell your life’s work. That is not the time to be loyal and help your friend learn on the job.
Be wary of the general business attorney who tells you, “I can do that too.” Because 99 times out of 100, they’re biting off more than they can chew.
Based on our experience, I’d estimate only 1 percent of the active lawyers in any state are truly M&A specialists who regularly negotiate transactions. Even fewer will be the right fit for your business, with experience representing businesses of your enterprise value and particular complexities.
So, make sure your M&A advisor is vetting all the professionals involved in your sale. You want that dream team who will get you across the finish line. Your trusted attorney can and should be part of the team, too, as long as you don’t put a generalist out in front.
