“we would like to bring a professional element for this company and turn it into a profession like real estate agents,” Taylor said.
A multinational company may turn to an investment banker for information on finding a purchaser, but an entrepreneur faces particular challenges.
Small-business sellers like to maintain their discussions quiet because they do not want their workers, suppliers or competitors to understand they’re seeking a buyer.
Setting a value for a small business is another thorny problem, particularly if the company is built on personal relationships which would be jeopardized if the owner left.
The last barrier–generally the highest one–is finding a possible buyer who can find the necessary financing. Banks and traditional lenders are now more reluctant than in the past to lend cash for new jobs.
Taylor, who envisions VR Agents becoming the Century 21 of company brokering, stated that, while the stagnant market is forcing buyers, also, to be more careful than before, many are also more sophisticated. Many of the budding entrepreneurs, he said, are refugees from a number of America’s biggest corporations and come equipped with MBAs and extensive business experience.
“Instead of selling into the blue-collar buyer of yesteryear, we are selling into the white-collar buyer”
Primarily an educational organization, the team promotes a code of ethics for business agents and provides referrals.
“Buyer activity is increasing,” West said, “and the people at VR possess a solid sense of marketing.”
West sees an increasing need for agents specializing in complex businesses such a computer businesses. “Someone with the connections, that speaks the industry language can be a real force in the market,” he said.
Question: I wish to sell my company and hope to receive about $300,000. How do I find a competent regional business broker?
Response: Business brokers typically do not market or maintain high profiles, so it is helpful to get personal referrals and interview a few candidates before you hire one.