Selling Your Startup

6Putting Your Finances in Order

Getting your finances in order is a critical step in M&A. The sooner you do it, the better.

This foundational step is vital for a smooth and efficient M&A process. Putting your finances in order will help you and your team get clarity on where you really stand as a company and acquisition target. It will be the basis for valuations. It will help you sail through and survive due diligence and know who your best target buyers are. It will also shine a light on what your alternative options may be, while best preparing bankers and advisors to do their jobs well. It can also help you create a strong, accurate, and effective pitchbook.

This is about organizing financial documents and having clarity on your own real numbers—something that will also help you optimize your finances and financial structure for potential buyers, as you'll discover in other sections of this book. Beyond presenting your company in the best light and with the best value possible, you'll be adding more value with fresh projections and financial models and preparing yourself and your team for the questions you'll be asked, from pre-LOI through to negotiations, due diligence, and closing.

This is about knowing the details, fine-tuning them, and the art of casting a vision of the value that could be.

Understanding Financials

You may or may not be a numbers geek. Many founders don't live and breathe for the finer financial details. They are visionaries, creatives, and doers. ...