Four Reasons to Hire an Online Business Broker When Selling Your Business

As a business owner, the path to successfully selling your business can be uncertain and intimidating. However, hiring an experienced online business broker to guide you through the exit process can eliminate much of this uncertainty, while also helping you maximize your business’s value and receive more favorable deal terms at closing.

In this article, we discuss:

• What online business brokers do
• Four reasons to hire an online business broker
• How to choose an online business broker
• Questions to ask an online business broker

What Online Business Brokers Do

In short, online business brokers help entrepreneurs successfully sell their businesses in exchange for a commission. In reality, however, an experienced online business broker (also called a MA Advisor, or Advisor) will do much more than just help you sell your business.

If you are thinking of selling your business, it makes sense to sell it for the highest price possible with the best deal terms you can get. In order to help achieve these goals, an online business broker will help maximize the value of your business long before it comes time to sell.

An online business broker will also:

• Ensure your financial statements and other documents are in order
• Perform a business valuation
• Assist with the creation of your business marketing package
• Vet potential buyers
• Help you structure the deal and negotiate favorable terms

During the sales process, your Advisor will help you access a wide range of potential buyers. They will also screen interested parties, evaluate incoming offers, and assist you through the negotiation and transaction processes.

By working with an online business broker to sell your business, you will be set up to move on to new projects in life. This could allow you to buy or start a new business, retire, or take on other passion projects.

“During the sales process, your Advisor will help you access a wide range of potential buyers.”

Four Reasons to Hire an Online Business Broker

Now that we have covered the basics of what online business brokers do, let’s take a closer look at some of the benefits of hiring a broker. Hiring a broker brings with it a range of benefits throughout the entire process, from preparation through closing. These include:

• Helping prepare your business to sell
• Gaining access to more buyers
• Obtaining a higher purchase price
• Securing better deal terms

Helping prepare your business to sell

A successful sale starts long before you actually sell your business. In fact, preparing your business for the market prior to listing it has a huge impact on your entire selling experience.

Before it is time to sell, your Advisor will work with you to:

• Improve your business processes
• Create standard operating procedures
• Drive growth
• Reduce or eliminate risks
• Clean up your financial statements
• Improve the transferability of your business

Essentially, your Advisor will provide you with guidance on creating a better-run, more profitable business. In addition to helping you operate a more successful business in the immediate future, it will also make your business much more attractive to potential buyers.

Additionally, your Advisor will provide an accurate valuation of your business, including the creation of an add-back schedule. This is a crucial step with a large impact on the final amount you receive for your business. Your Advisor will help you maximize your valuation while remaining realistic about what buyers will be willing to pay.

“A successful sale starts long before you actually sell your business.”

Gaining access to more buyers

Many entrepreneurs who sell their own businesses are left wondering where to sell their business or whom to sell it to. While there are numerous online business marketplaces, an experienced Advisor will help you access a larger pool of potential buyers than you would likely achieve on your own.

By utilizing their networks of investors and potential buyers, your Advisor can help find more qualified parties. Ultimately, this creates higher competition for your business.

Obtaining a higher purchase price

By carefully preparing your business for sale and creating access to a wider pool of interested buyers, you can naturally expect to receive a higher sales price than you would have otherwise obtained had you not worked with a broker. Preparation plus competition equals a win for you.

Securing better deal terms

A successful sale is about more than just the purchase price. The terms of the deal will have an impact on when you receive your money, conditions after the sale, and your level of involvement after the new owner takes over.

By working with your Advisor to create an attractive business and fostering a competitive bidding environment for it, you will be in a much better position to negotiate favorable deal terms with your prospective buyer.

“By utilizing their networks of investors and potential buyers, your Advisor can help find more qualified parties. Ultimately, this creates higher competition for your business.”

How to Choose an Online Business Broker

If you have decided to work with an online business broker, it is important to find one who is right for your needs. By doing careful research and knowing what to look for, you can find a trusted Advisor who will guide you every step of the way.

While all situations are different, there are several common factors to consider when choosing a broker.

Experience and knowledge

It should go without saying that you should seek guidance from a broker who has direct experience working with businesses that are similar to yours.

For example, if you are an entrepreneur who runs a successful Amazon business, you would want to work with an Advisor who has a lot of experience with FBA exits. 

When you choose someone who is knowledgeable about your business type and industry, they can better advise you on how to improve and present your business. In addition, they will have a better idea of what entrepreneurs or investors in your industry are looking for.

It is also important to keep in mind that a local business broker who specializes in physical businesses may not have the knowledge and experience required to successfully sell an internet business.

Motivation

In addition to getting a sense of the knowledge and experience of a potential broker, it is also important to gauge their individual motivation for working with you. 

Of course, your broker will be compensated for their time and effort. But more than that, do they seem genuinely interested in helping you achieve your goals? Are they engaged and interested in learning about your company and you as an individual? When providing guidance, do they seem to push for a quick sale to get their paycheck, or do they listen to your needs and take the time to do things on your terms?

The right broker should take ample time to get to know your business, its financial statements and operating procedures, and your involvement as an owner. They should work to meet your goals while providing a push or guidance when necessary.

Realistic expectations

Lastly, does your broker set realistic expectations about the selling process, including the expected sales price? While it can be tempting to work with someone who endorses anything you say and makes grand promises about the value of your business or expected deal terms, it is better to work with someone who remains grounded in reality.

Choose a broker who does their own research before offering their opinion. Additionally, they should be willing to disagree with you based on their assessment of the situation.

“The right broker should take ample time to get to know your business, its financial statements and operating procedures, and your involvement as an owner.”

Questions to Ask an Online Business Broker

Before you decide to work with an online business broker, it is a good idea to get to know them. By asking the right questions, you can help ensure you choose a broker who is right for your particular needs.

Gauge authenticity and motivation

Ask questions that will help you get a sense of their motivations as well as their level of honesty and authenticity. Questions like “What do you hope to achieve for your clients?” can give you an idea of where they may be coming from.

In addition, consider asking something along the lines of “Can you tell me about a time when a sale didn’t work out as planned?” Listen to what they say as well as what they don’t say. If they are honest about their successes as well as times when they could have done things differently, it is a good indication that they are approaching the situation with integrity.

“By asking the right questions, you can help ensure you choose a broker who is right for your particular needs.”

Evaluate experience and knowledge

Additionally, you should ask questions that allow you to get a sense of their experience and knowledge. Discuss what areas they specialize in, as well as the level of their past experience in that area. For example, if you are selling a content site, do they have examples of past experience selling website properties?

In addition, take some time to go through their past, current, and new listings. See for yourself what they have experience in, and what types of businesses they currently focus on.

By doing your research and choosing the right broker for your needs, you can help maximize the value of your business, find the right buyer, win more favorable terms, and create a successful and smooth selling experience.