hunting cloud network reported on April 23
note: we all know that startups, where is so difficult on earth? It not only is the startup difficult, more difficult when selling the bitterness! Indeed, the market popular is XX company is big company XXX XX company acquired rather than sell himself to the XXX company. But, it’s dogged that does it. Brontes to action for you, with your own examples to teach you how to “sell” yourself.
it is generally accepted that startups can only be acquired, which can not be sold. According to this logic, regardless of how much an entrepreneur wants to sell his company, he must first find a urgently want to buy your company’s buyer. Otherwise, no matter how much the seller wants to sell his company, everything is empty talk. As a result, some people think that startups don’t have to take the time to understand the buyer, because when a big company to buy your company, he will get in touch with you.
I understand the above this view, but I’m selling Brontes experienced Technologies, with the totally different. I and Micah rosen bloom (Micah Rosenbloom) jointly founded the Brontes Technologies, we are thinking of large-scale private tailored services to the dental industry. At first we want to sell the Brontes, there is no any buyer, but in the end, there are five buyers takeover bid is the result of the Brontes.
strategic financing program to test the m&a market
I remember, we were just for a test product B round, there was no income at all. Micah and I firmly believe that we can have a change of dental industry current situation of the technology, but the vc community didn’t watch it, because the product is not like enterprise software can be classified as well. We said to them, in the dental industry for large-scale private ordering service has a lot of development opportunities; But no matter how hard we try to persuade them, also won’t change them for not familiar with the market for your ideas, even the most excited investors, we could not convince.
in this case, micah and I decided to implement strategic financing. First of all, we think strategic investors can help financial investors better understand the potential value of the business. Second, I remember I said to micah such saying I have been convinced that: “if we can find the first person to bid, then it will cause a purchase our company’s war.” ,
when we don’t want to sell the company’s idea, but we believe that if eager acquirers can be found, can give the company to make a meaningful value. In addition, we also want to companies to build a good momentum in the future.
understand buyers are interested to buy company earlier, keep in touch with them
in the first two years, we spent a lot of time to learn about the industry’s well-known enterprises. Every company in the dental industry, head of business development may have told their chief executive, they are closely watching Brontes company, if you have any intention to sell the company, they will go and see. I think, in terms of sell Brontes company, this should be one of the most important investment we made.
the company by buying process is brief, but is ready to sell process is long
in the industry the company is also very understanding to us, we can’t just give them a call and let them to invest in a company that never heard of. While in contact with dental industry executives, wriggle we seem a bit, but we still managed to make a great reputation for our team, for the future development of the industry as a whole the dentist is very meaningful.
with the three we have contact with the company of the industry, and hope they can give us a chance, as our investors; The three companies to see we are positive efforts to run for the company, finally all agreed investment. In the beginning, we are not sure what you want is the strategic investment; As time goes on, we was persuaded by an investment company, he said the strategic investment is harm to us.
the rise of bidding competition
when we agreed to by the strategic investors led our B round of funding, is declared the battle started at our company. When we tell the other two strategic investment companies our decisions, they are very frustrated.
one of the companies specially flown to find us in the week, he asked us to eat want no agreement before we accept. He looked at me seriously said: “what are we going to do, you will accept our agreement, refused to others to accept our investment. We can give you any other company for valuations.”
my answer is: “this has nothing to do with the valuation. Is worried that if we accept your company’s strategic investment will affect our future and cooperation of other firms, say you is not what we want that kind of investor; Until after you are willing to pay big money (in the industry will never purchase price) for our company, otherwise, I think it is impossible to our current cooperation.”
we never imagined, they in the second week as we issued the tender offer, the price is really unprecedented.
intended to sell, it does not sell
in the past two years, we know all companies within the industry; Of course, these efforts have paid off. So, after we received the first bid immediately call another potential buyers, told him that we have received a copy of the offer, but we don’t want to in their to take any action without knowing it. We want to know right away they acquire the sincerity of our company, and they can provide the purchase price.
two weeks later, the acquisition of our company for the results of true as expected opened. There are five companies bidding acquisition Brontes. At the beginning of the competition, 3 m is not our first choice, but later the company let us see their sincerity, let us see the Brontes platform development potential in their company. Acquired after the war, our management team agreed that we want to be in 3 m, 3 m to $95 million last the Brontes. The acquisition of final price war is the first to offer two times, which have increased the value of a company by half.
if no one in the industry know the importance of what we are doing, there will be interested in buying our company? To the acquisition of our company there will be war? The answer must be: no. As mentioned at the beginning, our company was originally no buyers, but finally ended up with multiple buyers compete.
to sell a company needs a long process, is not you want to sell will be someone to buy; , so, you must be a long-term vision for selling the company to be prepared for long. Before intended to sell the company, must to know of the buyer, both parties shall establish a relationship of mutual respect.
in a word: companies are buying process is brief, but is ready to sell process is long.