Buy or Sell a Startup at BizTrader.com
A new online marketplace for buying and selling companies officially launched this week: BizTrader.com. I believe BizTrader will be a strong competitor to the current company marketplace juggernaut, BizBuySell.com. Both BizTrader and BizBuySell charge...
Don’t Be Coy With a Letter of Intent
I recently worked on a deal where the prospective seller over-strategized the letter of intent. The seller wanted my client to sign a non-binding LOI that contained about half of what should have been included in the letter. It was extremely frustrating...
How To Handle Intellectual Property When Buying A Business
The business purchaser needs to ascertain if intellectual property rights are needed for the continued operation of the business. Intellectual property rights that are important include trademarks, copyrights, service marks, and trade names. All of these...
The Deal Behind Letters of Intent
A letter of intent is a pre-acquisition agreement that shapes the preliminary understandings of the parties. Although usually non-binding (for the most part), it serves as the bridge between initial negotiations and the purchase agreement. And that’s...
How To Optimize Your Blog Sale
Bloggers optimize. Bounce rates, feeds, heatmaps, plug-ins, keywords, and sneeze pages are just the tip of the blogger’s optimization iceburg. So why are blogs sold in such a nonoptimal way? Blog selling is once again a hot topic. Most articles...
Get a Deal Done with a Go Shop Clause
When acquiring a company, you typically want to lock down your target and prevent it from seeking other potential buyers (see no shop clause). But in some situations, allowing your target to shop the deal around, under the terms of a “go shop”...
What is a Leveraged Buyout?
A leveraged buyout (”LBO”) is a strategy where someone acquires an existing company using a significant amount of borrowed funds. Typically, the assets of the company being purchased are used as collateral for the borrowed funds. This allows...
Negotiate the Basket
In the world of mergers and acquisitions, a “basket” is the amount of damages that must be suffered by the acquiring entity before it can recover from the seller under the indemnity provisions of the acquisition agreement. Three main issues...
Using a No Shop Clause in a Letter of Intent
If you are buying a business, the process becomes expensive and tedious once the letter of intent is signed. For this reason, I recommend all buyers include a “No Shop” provision in their LOI. This provision prevents the seller from going...
When to Use an Earnout Provision
An earnout is the method of paying the seller of a company based on that company’s future earnings. The earnout will call for additional payments to the seller if the company’s post-sale earnings reach a certain level. The earnout is useful...
