In addition to selling companies, Mentor Securities provides financial advisory to buyers. These engagements involve a monthly retainer and a success fee, usually a percentage of the purchase price.
Buyers include individuals with capital or access to capital; private equity; and, companies purchasing for strategic purposes. Most often we are engaged by strategic buyers, who recognize the importance of utilizing our skills to perform the following basic process:
- Determine the buyer's specific appetite for sellers based on revenue, profits, product/service fit, access to new markets, etc.
- Align buyer's ability to fund a deal, either with balance sheet cash or access to other outside capital, with the expected price for the specific targets.
- Agree upon the metrics and terms of how the buyer wants to approach the targets.
- Assess the overall market for potential candidates.
- Reach agreement with the buyer on how to pursue targets identified.
- Organize due diligence on targets willing to discuss a sale. Discuss terms and pricing with seller and assist in creating a Letter of Intent (LOI).
- Work with other advisors, especially accounting and legal, to complete the diligence.
- Advise buyer on how diligence affects the pricing and terms of a purchase agreement.
- Continue dialogue between buyer and seller until a deal is curtailed or closed.