This is the PKF Texas Entrepreneur’s Playbook I’m Jen Lemanski and I’m back again with Matt Goldston, an Entrepreneurial Advisory Services director and one of the faces of PKF Texas’ Transaction Advisory Services team. Matt, welcome back to the playbook. Thank You, Jen So we’ve been talking about selling your business and we’ve been talking maybe about planned sales, if you will. But what happens if a founder or an owner gets a call out of the blue and says “Hey I want to buy your business.” What do they do, do they freak out? What steps should they take? Oftentimes they freak out but being able to assess a call like that timing is of the essence being able to assess their conversation and their interests, particularly if you know the company and you know that you may bring value to that company, being able to run that through the filter of knowing the value of your business is important so that you don’t inadvertently miss an opportunity. So, do these calls happen often? Do you see it often that they just come out of the blue? I do see it often. Many times, it’s financial buyers that are looking to tuck in a company that’s not of a strategic value, but knowing the difference between those buyers and someone that’s calling with strategic value that’s the important distinction, and it’s important to know who that might be. So what should a company do to be ready for when they do get that call out of the blue? They should prepare as though they are preparing for a process. In other words, what I do, for instance, is I’m always ready to transact a company. Information is readily available, and we’ve taken steps to gather and mitigate any risks that are known Being able to provide information quickly, having financial statements that are current, tax returns that are filed with a reputable firm that’s going to help a seller through a transaction. Because they may look differently at their tax situation leading up to a sale as opposed to just a tax efficient approach for a founder. Interesting. So they should always have the endgame in mind even if they’re not ready for a sale. Absolutely. There’s value in that. Being prepared to sell is a part of the process. Being able to answer the call and deal quickly and promptly with a buyer, that ties in all the effort that otherwise goes in preparing for a transaction. I know you’ve mentioned that you’ve had people pass on those calls and then they end up selling their business for even less than the original call. Absolutely. I’ve seen that many times. I’ve seen strategic buyers call, and the founder not knowing his value dismissed that opportunity, and then ultimately transact at a far less value than what they had originally discussed. Interesting. So, we’ve got to get you guys in there so that you can help them find that value. Absolutely. It’s a process and an approach, being strategic and how the founder deals with companies that might be strategic partners, and it’s a great opportunity to get in and help clients. Great, well, we’ll get you back in to talk a little bit more about it. How does that sound? That sounds great, Jen. Thank you. Perfect. For more information about this topic,visit PKFTexas.com/TransactionAdvisoryServices This has been another Thought Leader Production brought to you by PKF Texas – Entrepreneur’s Playbook. Tune in next week for another chapter.