This document discusses different exit options when selling a business, including sale to a trade buyer, sale to a private equity firm, completing a stock market listing (IPO), or undertaking a debt-funded capital restructuring. It provides overviews of each option and key factors owners should consider such as their desired involvement post-transaction, the business's growth trajectory, and competitive landscape. Sale to a trade buyer is driven by opportunities for scale or expanding into new areas. Private equity interest has grown with attributes including a need for growth capital or partner. An IPO is rare for professional services and requires significant scale. Overall the best outcome depends on matching the owner's goals with the business characteristics.

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Growing equity, realizing value
What are your exit options
when selling your business?

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Summary
Sale to
trade buyer
Sale to financial
investor (PE)
Stock market
listing (IPO)
Debt-funded capital
restructuring

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Key factors
The best outcome for a seller is driven by these factors
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The founder /
owner desire for
involvement post
transaction
1
The overall growth
trajectory of the
business
(past and future)
2
Competitive
landscape
3
Uniqueness of
service offering
or skillset
4

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Definition of “trade” or “strategic” buyer
Why trade buyers make acquisitions?
The current market for trade deals is very strong
Sale to trade buyer
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Reasons for acquisition Risk Supply
Build scale in current
business footprint
Low Low
Expand current model by acquiring
adjacent firms, new service lines or
new geographic coverage
High High

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Considerations for a business owner seeking
A trade buyer
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What are the
partnership
opportunities
in my sector?
What is my
synergy case?
What do I do
that nobody
else can do?
Sale to
trade buyer

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Debt-funded capital restructuring
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Definition of a capital restructuring
Debt capital providers to professional services
When is this the right type of transaction

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Debt-funded capital
restructuring
Considerations for a business owner seeking
A capital restructuring
7
The best time
to borrow
money is
when you
don’t need it
Cash flow
dynamics and
balance sheet
strength
How would
this fit into
the longer
term
ownership
goals?

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Sale to financial investor (PE)
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What are Private Equity firms
Why PE firms buy professional services firms
We have seen increased interest
from PE firms in recent 2 years
Key attributes that attract PE

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Sale to financial
investor (PE)
Considerations for a business owner seeking
A PE deal
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Desire for a
growth
“partner”
Need for
growth capital
Is this a
growth or
lifestyle
business?
Desire to stay
involved in
next phase of
growth

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Stock market listing (IPO)
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How an IPO works
Quite rare in this sector
Scale and growth requirements

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More resources
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