Many entrepreneurs believe that the only role of a M&A Advisor is to find buyers for their companies. However, this is only half of the story. M&A Advisors do a lot more than simply locate buyers. Here are just a few of the valuable services they provide to sellers:
When a business owner receives unsolicited interest from a buyer, whether the big name in the industry or a unique financial buyer, his first instinct is often to pursue it right away; it seems natural to follow that path. The danger is that you give up negotiating control, the powerful benefit of competition, and at that point, deals tend to derail.
John Warrillow, author of Built to Sell, explains why this is and how to avoid it:
When you heard that the LA Clippers sold for $2B, what did you think? That’s a lot of money was what crossed my mind. But then it struck me: a number of lessons could be learned from the sale. Why did it get $2B when many thought it would go for less than $1B? Why did the parties move so fast? How does this apply to smaller, private companies?
All great questions. All applicable if you own a company.
"Blue sky" is a colloquial term that means, according to Merriam-Webster, "having little or no value" and "not grounded in the realities of the present." The term is often used in reference to the intangible value of a business, but that doesn't sound like the definition! Business usage of "blue sky" terminology is probably best replaced with the term "goodwill" which does specifically refer to the intangible value of a business.