Professional Services

1

Initial Discovery. Each client engagement begins with an in-depth discovery process. We will meet with a seller at our office to work through a detailed questionnaire our team has developed over the course of many years and hundreds of transactions. We’ll review as much details as you can provide, including marketing materials, Web content, customer/client reviews, operational documents, and anything else that is important for us to really understand your business.

2

Financial Assessment. We have a trusted CPA partner that provides an independent financial review of every business we represent. This is intended as a third-party assessment of a seller’s financials; our CPA partner is highly experienced in small business transactions. We instruct them to review the financials from the perspective of a prospective buyer, and through experience they are skilled at identifying the items that will likely be questions from a buyer, a buyer’s accountant, or banks that are financing the transaction. This financial assessment is an important investment we make in each client engagement.

3

Marketing Plan. Once we have completed the in-depth discovery, and in parallel to the financial assessment, our deal team prepares a full marketing plan to bring a seller’s business to market. The foundation of every plan is a strategy agreed upon by our team and the seller – this is how we plan to market the business. Based on the marketing strategy we create custom marketing materials, including advertisements, a “teaser” summary, and a detailed (15-20 page) marketing package.

4

Opinion of Value (OOV). An essential part of the process is determining the value of a seller’s business. We have a proprietary valuation model called the Opinion of Value (OOV) that our team has developed and refined. The OOV has proven to be an invaluable tool for determining the market value of a small business. It takes into consideration a wide range of elements, using financial and operational data inputs that are both quantitative and qualitative. Collaborative’s OOV model has been recognized by bankers and accountants as an industry-leading approach to small business valuation.

5

Listing Go-Live. The phases outlined above represent the significant amount of work that is put forth by our team before a seller’s business is listed. It’s critical that both our client and our team is confident in the financials, marketing plan, and valuation before we take the business to market. When ready to move forward, we “go live” with the listing and begin executing the marketing plan.

6

Buyer Qualification. Upon listing a client’s business, buyers will immediately begin to inquire about the opportunity. In addition to prospective buyers generated by the marketing efforts, we have a robust network of interested parties – including serial entrepreneurs, business investors, and transitioning corporate executives – who are always looking for new opportunities. We work closely with prospective buyers, vetting their experience and financial profiles, as well as ensuring appropriate confidentiality agreements are signed. Only qualified buyers are presented to our clients, and it is up to the seller whether or not to proceed to having discussions with an interested buyer.

7

Initial Meeting. Our team facilitates an initial meeting with each qualified buyer that our client agrees to interact with. From there the relationship may end immediately if either party is no longer interested, or it may continue for a period of time during which the buyer and seller are getting to know each other and discussing preliminary information about the business and a potential transaction.

8

Letter of Intent (LOI). When our client and a prospective buyer are interested in moving forward, we work with both parties to draft a letter of intent (LOI). The LOI is a critical step in the process, as it outlines the most important terms that are expected to be included in the acquisition/divestiture (e.g. selling price, assets to be purchased, expected closing date, transaction contingencies). Buyers and sellers should always come to terms on a letter of intent at this point in the process, before moving forward with due diligence – this reduces the risk of both parties committing time and financial resources to the transaction, only for it to fall apart later in the process when the parties ultimately disagree on a key term.

9

Due Diligence. The due diligence period varies widely for each transaction. With a signed LOI in place, the seller and buyer work through detailed discussions, reviews, questions, and meetings with their respective advisors. We work collaboratively with everyone involved with a focus on ensuring both sides get what they need.

10

Bank / SBA Financing. Most small business transactions involve a buyer’s acquisition of the seller’s assets through a divestiture. And in nearly all cases, the transaction is financed through a bank commercial lending program backed by the Small Business Administration (SBA) guarantees. The process for securing financing can be complex and time-consuming, especially for a buyer going through the steps for the first time. Our experience with these transactions and relationships with banks mean we can provide invaluable assistance to buyers (detailed in “Buyer Assistance” section below). Helping navigate the bank and SBA financing process is a significant part of every deal, and many transactions would fail to close without our expert guidance.

11

Legal Agreements. In the late stages of an engagement, once the seller and buyer are nearing the completion of due diligence and financing has been secured, we assist with development of legal agreements. This includes an asset purchase agreement, along with a variety of other documents specific to the transaction. We have attorney partners that we can bring to the table as independent third parties, or we can work closely with a seller or buyer’s trusted legal counsel.

12

Closing of Transaction. Closing is the official completion of the transaction. This is an exciting and stressful event for all parties involved, so we coordinate all the details involved to ensure the best possible experience for both buyers and sellers. We work with a respected third-party title company for closing logistics – this is important for managing all the documents and details, and also a necessity if there is real estate property involved in the transaction. Closing day is typically a very gratifying moment after all the work that has been done over several months. Just like everything else in the process, Collaborative approaches the closing of each engagement as a team activity, with our entire deal team taking part in the occasion so we can celebrate with our client and the buyer.