To buy a company is a long process, and in it, there are moments of intense emotions, breakdowns, and crisis, when it seems like the deal has fallen through, unable to be saved.
As M&A advisors that have participated in numerous operations know that it is a matter of tenacity – of not abandoning – of looking for creative solutions that keep the deal alive again and again until it is finally signed and closed with the satisfaction of all parties.
Who can buy a company
There are times when the opportunity knocks at your door, and if you are psychologically prepared, you can capitalize on it. But this is not usually the case. Usually, the opportunity is close to you, maybe in the very same company where you work or in a related sector, but you think that you have to create it. And other opportunities do not appear unless you look for them.
Do not rush the choosing or buying process. Be patient and work on various deals at a time. If a deal falls through, take it as a learning opportunity to make a better purchase next time.
We recommend you not to get fixated on a robot company but instead to be flexible and dig deep into the companies before rejecting them since you can be pleasantly surprised. However, at the same time, you should be proactive and define what you are looking for.
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The importance of the sector when buying a company
If you have experience in a determined sector (even if you may be sick of it), we recommend that you search in this sector or those related to it. If you have experience in machinery rental, do not look for restaurant chains. This sector might not look attractive to you because there is excess capacity and because construction has suddenly fallen, but there are many other subsectors with similar characteristics that are doing well. Look for opportunities in the rental sector to which you can transfer your years’ worth of experience. Do not begin in an industry that is completely new for you because the learning curve may be very steep, and you may be taken advantage of during the purchase process.
I remember a company that we were trying to sell. A financial advisor was interested in it and made us all go crazy by asking us financial models and sensibility analysis about the future even though he was not sure about buying the business. On the other hand, the seller’s competitor saw the equipment (in this case, ships) and said, “I’ll pay 30 for it.” He sealed the deal. He understood the value of the company because he was perfectly familiar with the sector.