How do you sell an IT business? Here, we will address not only how to sell an IT business, but how to sell an your business for top dollar. First, we will look at preparations recommended to get your IT business ready to sell. These preparations can be addressed even when the prospect of selling is still down the road, but should certainly be done before you actively begin the selling process. Then, we will outline the next steps involved in selling an IT business.
How to Sell an IT Business: The Preparation
Tidy Up
We do not mean this figuratively. If you have been putting off any repairs, maintenance, or cleaning projects, now is the time to knock them out. The books will tell the lion’s share of your business’s story, but it is worth a reminder up front that unkempt facilities can have a significant negative impact on potential buyers. Take the time now to address anything that needs cleaning, organizing, or repair before a buyer is ever invited in for a look.
Gather Paperwork
In addition to cleaning up any company property or facilities, be sure to get your business records in order. Having asset lists, property inventories, lease agreements, etc, gathered and organized will show potential buyers that you are serious about selling.
How to Sell an IT Business: The Process
Reconcile the Books
Connect with your CPA to provide up-to-date financials. You will want fully reconciled, accountant-prepared financial statements to show what is coming in and going out of the business. Cash flow is king when it comes to selling a business, and professionally prepared financial statements are a must.
Obtain a Professional Valuation
A business valuation uses a combination of methods and formulas to calculate your IT business’s range of value. A valuation document is the single most useful piece of financial information about any company, and as such, demands an accurate and comprehensive approach. It is nearly impossible to determine an accurate valuation of your own company. Obtaining a professional business valuation is critical.
Choose an Advisor
Choose a business broker or advisor who knows how to sell an IT business and who will guide you through the remainder of the complex business selling process. Confidentially marketing your business to potential buyers, screening those interested, negotiating offers, navigating the buyer’s due diligence period, and staying on top of contracts and documents all the way through closing… selling a business can be overwhelming. Not to mention trying to sell it for top dollar.
You can avoid many common missteps by meeting with business advisors like Viking Mergers & Acquisitions early in the process. As fellow business owners who have bought and sold companies in a variety of industries, including the IT sector, we have been on both sides of the negotiating table, and we can draw from that experience to benefit you.
If you’re thinking of selling an IT business, contact us today for a no-cost consultation.