The Art of Reverse Due Diligence: How Smart Founders Avoid Bad Buyers

In today's issue, we're covering:

1. The Art of Reverse Due Diligence: How Smart Founders Avoid Bad Buyers

2. How to Avoid Taxes When Selling Your Business (A Step-by-Step Guide)

3. Why Preparation Is Your Best Exit Strategy

Let's dive in!

The Art of Reverse Due Diligence: How Smart Founders Avoid Bad Buyers

Let's be honest, not all buyers are created equal.

And while that $50M offer might look tempting, the wrong buyer can turn your dream exit into a nightmare.

Here's how to vet potential buyers like a pro.

Start with the Basics:

These are your must-check items before any serious discussions:

• Financial Capability: Get proof of funds or financing commitments early

• Track Record: Research their past acquisitions and how they turned out

• Industry Experience: Do they understand your market, or will there be a steep learning curve?

Don't be shy about asking tough questions. It's your business at stake.

Dig Deeper:

Once they pass the initial screening, investigate:

• Post-Deal Plans: What's their vision for your company?

• Integration Strategy: How will they handle the transition?

• Cultural Fit: Will they maintain your values and team dynamics?

Remember, the highest offer isn't always the best offer.

Watch for Red Flags:

These warning signs should make you pause:

• Vague Responses: Clear questions deserve clear answers

• Rushed Timeline: Good buyers understand proper diligence takes time

• Resistance to References: Strong buyers are proud of their track record

Remember, you've spent years building something valuable. So taking time to vet your buyers is a smart move.

The right buyer? They'll respect your thoroughness and match it with their own professionalism.

Need help vetting potential buyers? Reply to this email, and let's talk.

Featured Blog 📰

Worried about the tax implications of selling your business?

Our latest blog explores strategies to minimize your tax burden while maximizing your exit value.

We cover:

• Why timing matters for tax purposes

• Strategic approaches to structure your sale

• State-specific considerations that could save you millions

Check out "How to Avoid Tax on Sale of Business (Step-By-Step Guide)" on our blog.

M&A Tips from Brian Dukes 💡

Selling your business can be a lot like preparing for your dream job.

And if you're not thinking ahead, you're falling behind.

Too many founders wait until they're ready to sell before they start thinking about strategic partnerships, ideal acquisition targets, valuation, market positioning, and buyer expectations.

But by then... it's often too late.

Read the full post on LinkedIn.

That's all for this week!

Remember, thorough preparation and smart buyer vetting are your best friends in the exit journey. Don't rush the process — take the time to do it right.

Best,

Brian Dukes