Negotiation Advice for Selling a Business or Asset

Negotiation Advice International (NAI) has advised brilliant entrepreneurs and businesses of all sizes on selling a business part or all of their ownership stakes, as well as significant prized assets, consistently helping our clients achieve remarkable results based on our distinct negotiation experience, methodologies, and background in finance.

We also advise buyers on occasion, giving us a 360-degree view of the buying and selling a business negotiation process, and have even quietly counseled seasoned entrepreneurs on shows like Shark Tank to provide structure and strategy for buying stakes in start-ups through a televised format.

Negotiation Advice International (NAI) is a boutique advisory firm that works with only a handful of clients at any one time. As our client, you will have the focused attention of our Managing Director, Peter D. Johnston. Peter is a former investment banker, Harvard MBA, and one of the world’s foremost negotiation experts. His exceptional abilities have been formally recognized for their positive impact by the US Government. He is also the international bestselling author of Negotiating with Giants, which delves into how smaller players can get what they want from larger counterparts, including mergers & acquisitions advice for small and medium-sized enterprises (SMEs). Peter spearheads all deals and brings in supporting expertise as required from inside or outside NAI.

As a client receiving advice in negotiating the sale of a business or a significant asset, we work hand-in-hand with you and help you navigate your own interests, aspirations, and dreams while you prepare for selling a business in the short-term or longer-term. One way or another, we can be by your side for the journey.

Common Challenges in Negotiating the Sale of a Business or Asset

Owners of small and medium-sized enterprises (SMEs) usually encounter a handful of recurring challenges when selling a business or major asset, depending on your profile, training, and personality:

Internal differences among different owners or stakeholders prior to and during negotiations can lead to sub-optimal results or no deal.

Owners are busy running their businesses and often don’t have the time to oversee and execute such vital, time-consuming negotiations.

Owners are experts in their area of business but they are less comfortable negotiating significant, life-altering transactions.

It can be hard to be objective about what your asset or business is worth and pitch it effectively to buyers.

Not knowing how to avoid becoming captive to one buyer or how to manage multiple potential buyers in parallel.

Lacking the experience to protect business secrets, confidential information, and key employees to ensure the selling process doesn’t result in the loss of proprietary knowledge and significant value.

Hiring the wrong lawyers, or using them the wrong way, can lead to spiraling costs and poor outcomes. Legal fees can add up to a material percentage of a transaction if one lacks experience managing them.

Adding to this list of challenges: owners of small and medium-sized businesses are often selling to much larger, powerful buyers who are constantly buying and selling businesses with lots of know-how, expensive lawyers, and multiple alternatives to achieve their goals.

Distinct Advice for Selling a Business, Yielding Exceptional Results

We think really differently about how to sell businesses, maximize value for our clients, and navigate all the challenges associated with the process.

Given that our expertise includes dealing with larger counterparts, we are frequently brought in to help even the scales — and then tip them in favor of our clients, applying the methodologies described in our international bestselling book, Negotiating with Giants.

Regardless of your counterpart’s size, in situations involving multiple owners within a client organization, our unique approaches often start with gaining internal alignment. We do this whenever appropriate to ensure there is nothing internally slowing down the ability to create external value through the right products and services, the right customers being targeted in the right markets, and the right timing to sell a company or a portion of its shares to generate liquidity or new funds to grow. Our background and negotiation credentials include expertise in conflict management and both formal and informal mediation which often proves critical in complex transactions involving multiple parties, including key employees, managers, and owners.

Independent of internal negotiation dynamics, we are pioneers in what’s known as integrated negotiation, whereby we help you, as a client, ensure your systems and operations are well-tuned for sale to a targeted group of potential buyers, creating optimal overall value once our unique negotiation strategies and tactics are woven into dealings with potential buyers.

With respect to external negotiations, depending on what’s most helpful to you as a client, we can provide any or all of the following services:

Raising funds in return for the sale of debt, equity, hybrid offerings, or your business as a whole, depending on your interests.

Generating in-house or external valuations for your business or asset, often from the perspective of multiple potential owners.

Preparing marketing materials for distribution to potential buyers.

Attracting or approaching potential buyers on your behalf.

Advising you behind the scenes on how to best negotiate with counterparts, or going to the table on your behalf.

Creating unique process options for selling, such as tailored auctions, parallel or sequenced multi-party negotiations, and distinct approaches for dealing with a single buyer to avoid their monopolizing your time.

Coordinating due diligence efforts by buyers and closing the deal.

Hiring, overseeing, and/or coordinating lawyers to advise on important issues and finalize documentation. We have saved individual clients hundreds of thousands of dollars in legal fees because of our collaborations with excellent lawyers.

Throughout the negotiation process, we think defense first, ensuring that you are protecting your proprietary information, client lists, and key employees to maintain your distinct value, whether the sale goes through or not. We also take a flexible approach because there is often a range of ways your interests may be satisfied that don’t involve an immediate sale.

Summary of Services for Negotiating the Sale of a Business or Asset

Whether negotiating the sale of a business or negotiating the sale of an asset that means the world to you, NAI offers you peace of mind by taking care of whatever needs you prioritize, increasing the odds you will achieve remarkable results. While we advise clients of all sizes on transactions, our negotiation services in this area are uniquely tailored to entrepreneurs busy doing what they do best and want expert guidance from an experienced negotiation team.

Our services are comprehensive, including everything from helping build value in an asset or business prior to sale, valuing assets, and identifying buyers or sellers, to overseeing lawyers working on the transaction to ensure cost-efficiencies and favorable results. We can also negotiate directly on behalf of our clients in the divesting or acquisition of a business or other asset. NAI offers an array of purchase and sale services, from which clients can choose depending on their specific strategic, financial, and emotional needs.

Selling Businesses, Shares & Other Prized Assets: Case Examples

Case #1: Selling a Group of Fast Casual Restaurants

The owner of a small, fast-growing group of restaurants approached us to help her negotiate directly with the CEO of a large, international restaurant chain who’d expressed an interest in buying her unique restaurants. Over the course of a year, we advised on every aspect of the final sale, which included: guiding the owner in prioritizing her interests in selling or not selling; negotiating with unhappy shareholders in the business being sold to ensure they would approve the transaction once reached; suggesting prioritized improvements to operations to increase value; exploring a range of alternatives and buyers to maximize value in the transaction; negotiating directly on behalf of this owner while she focused on running her business and building its value; overseeing due diligence on the restaurants and final documentation of the deal negotiated; coordinating the legal teams involved to minimize costs and optimize outcomes.

Case #2: Selling a High-Profile Internet Domain

The owners of a category-killer domain came to us after years of trying to sell their domain without success. NAI initiated and ran a uniquely structured global auction out of the Netherlands, and heavily promoted this auction in conjunction with Escrow.com, our partner on the project, through a new website for which we hired a strong design firm. Potential buyers were vetted and dozens registered. We negotiated the final terms with the winner, overseeing the documentation process, the hiring of the legal team that supported our efforts, and the distribution of payments. While the price paid for the domain and the name of the buyer remain confidential, the result was deemed to be a historic success for both the sellers and the buyer of this domain.

Case #3: Advising the Founder of a Well-Known Brand on Selling his Company

The dynamic founder of a fast-growing international brand had been frustrated in his ongoing efforts to liquidate a portion of his minority stake and to earn more money from the early-stage strategic investors who now dominated his board. We went to the board on his behalf, promoting his interests, and subsequently helped negotiate the sale of the company to an investment group. The result: our client was able to bank a considerable sum of money, while still maintaining a significant stake under the new owners. We negotiated his new role and higher compensation, hiring lawyers to support us in that process.

Case #4: Negotiating the Sale of a Division in a Marine Biology Company

The founding partners of this company approached us to help them sort through internal conflicts among themselves, including whether to sell all or part of their company or just part of it and how to best manage ineffective areas within their broader senior management ranks and specific service groups. We interviewed the founders and their senior team, assessed the business, conducted personality type assessments, and uncovered core issues that were causing the communication, relationship, and performance issues. We coached individuals and the executive team on how to manage these issues we’d identified and then mediated talks among the partners as to what they wanted for themselves and the company going forward. The result: the sale of a division instead of the company as a whole, with a clear transition plan for the founders retiring and selling their shares to the next generation of leaders.

Case #5: Building Value in a Tech Start-Up Prior to Selling Shares

NAI was called by a young entrepreneur who had a $3 million offer for his start-up, and he was looking for guidance. After we learned more about his business and ran some quick valuation metrics, we suggested he consider not selling just yet. The first thing we focused on was sorting out differences and undocumented deals among the company’s founders, which then opened up the possibility of bringing in an angel investor, whom we attracted. With this new money, we hired some experienced managers who helped accelerate the company’s growth. As a final step in supporting our client, we negotiated a $5 million equity injection from a leading venture capital firm. The company was now valued at $20 million, or $17 million more than just ten months earlier, prior to our involvement.