Does this sound familiar? You want to grow through acquisitions, but there are no good companies to acquire. While it may seem like there are absolutely zero acquisition prospects, usually that is not the case.

Many companies struggle to find acquisition prospects because they are focusing on only on industry partners, suppliers, or competitors they already have a relationship with. We call these companies the “usual suspects.” There’s nothing wrong with looking at the “usual suspects” for acquisition opportunities, but if you find you are hearing the same company names over and over again without getting any results, it may be time to try a new approach.

Here are four more ways to find quality acquisition prospects in addition the “usual suspects”:

  1. Market Research – In researching the market you will naturally uncover a few potential acquisition prospects. You will also have the advantage of gaining a deeper understanding of the market which will help you select the best companies to acquire, evaluate potential acquisition candidates, and negotiate with owners.
  2. Trade Shows / Associations – Both are an excellent source for finding many companies in your desired industry in a short amount of time. Walk the floor of a trade show and you’ll see dozens of companies all in one location and many trade associations also member companies listed on their website.
  3. Internal Input – Use the resources you already have. Your sales team is filled with folks who have their ear to the ground and are up-to-date on key players and new developments in the industry.
  4. For-sale Companies – Looking at for-sale companies is never a bad place to start your search. Just make sure you don’t limit yourself by only considering these opportunities. Including not-for-sale companies in your search will increase your chances for a successful acquisition. Remember, every company is for sale, for the right equation.

For more tips on finding companies to acquire join our webinar Building a Robust Pipeline of Acquisition Prospects on March 23.

After this webinar you will be able to:

  • Approach the search for the right acquisition prospect systematically
  • Understand effective research methods for identifying prospects
  • Develop criteria for your ideal acquisition prospect
  • Use tools for objective decision-making during the acquisition process

Building a Robust Pipeline of Acquisition Prospects

Date: Thursday, March 23, 2017

Time: 1:00 PM – 2:00 PM EST

CPE credit is available.

Photo Credit: patchattack via Flickr cc

The possibilities may be endless, but your resources are not. For many business owners with limited time and money, deciding which ideas to pursue can be a challenge. Here are three ways to prioritize your options for growth:

1. Start with your company vision

The best way to make sure you’re moving in the right direction is to take a step back from all of your ideas and begin by looking at your vision for your company. Who do you want to be as a company? When you have a clear picture of your goal in mind, it will be easier to visualize what steps you need to take in order to achieve it. Without a clear vision you could end up pursuing options that actually drag you in an opposite direction.

2. Use tools to stay objective

While it’s natural to be somewhat subjective, after all business growth is exciting, you don’t want to make decisions based on emotions alone. Try bringing objectivity into your decision-making process by using tools to evaluate and compare your options. When it comes to external, growth, we typically use the Market Criteria Matrix to evaluate the best markets for growth and the Prospect Criteria Matrix to evaluate acquisition prospects. This tool can be adapted to evaluate any opportunity for growth.

Keeping your vision in mind, develop about six key criteria of your ideal opportunity. Next, you develop metrics to quantify the criteria. For example, if one of your goals is to expand your operations to the West Coast, one of your criterion would be location and the metric could be located on the West Coast. Give each option a rating using a 1-10 scale and see how well the options compare to each other and to the criteria you’ve established.

3. Gather data

Making a decision without the proper information can be a big mistake. Conduct research to validate (or invalidate) your assumptions. You don’t have to uncover every granular detail, but it will be helpful to have an understanding of trends and how they will impact your market in the future. One of the best sources of information about the marketplace is your customers. Try identifying the needs and wants of current and future customers. It may even be as simple as conducting a customer survey or asking your sales department for input.

While it can be overwhelming to process through all your options for growth, the good news is that you have many options! Hopefully these three suggestions will help you organize your thoughts as you plan your next steps.

Photo Credit: Bs0u10e0 via Flickr cc

The New Year offers a fresh start for setting goals and creating a positive tone for the rest of the year. If you strategize well, you will find unique opportunities in the next 12 months to grow your business through M&A.

Before rushing off to find companies to acquire, however, make sure you are looking at the right markets. A business that is profitable today in a declining market may be struggling or even gone in a year. Find out where future demand is. Think about what markets you’d like to reach, which industries are growing, and what your customers are demanding. Evaluate which of these markets best fits into your strategic plan for your business.

Join me for our first webinar of 2014, “Discovering Markets.” You will learn in this presentation how to identify expanding markets and select the best segments to grow your business. Set yourself up for success in 2014 and beyond: register today: https://www3.gotomeeting.com/register/298601502

Date: Thursday, January 23, 2013
Time: 1:00 PM ET

CPE credit available.

Register today: https://www3.gotomeeting.com/register/298601502

Photo Credit: Kamal H. via Compfight cc

“Keep your pipeline full,” I often tell clients when speaking about their acquisition prospects. By this I mean that in pursuing M&A you should research 75 to 100 companies. That’s a lot of companies and research, which of course you must record in an appropriate manner.

How can you keep track of all your data? What member of your acquisition team is best qualified to monitor, control, and update the pipeline database?

The short answer is someone who is extremely detail-oriented and organized. Think of this person as the M&A librarian. I recommend the librarian is not the acquisition champion because this role will require a fair amount of work. The librarian will meticulously keep track of all the information gathered by the acquisition team and catalogue it appropriately.

My clients often use tools such as Microsoft Access, Salesforce, Act!, or other data management software to organize all the data. Recording your findings in an orderly, accessible fashion is critical to ensuring your data is useful and meaningful to you during the acquisition process.

Photo Credit: boltron- via Compfight cc

As, you know I am a strong advocate for the “markets first” approach to searching for acquisition targets. The idea is that before you look for a company to buy, you define the market in which you are going to conduct your search. The reason for first selecting a market is to ensure that there is a healthy, stable demand for your acquisition’s products or services. Without that certainty, you have reason to beware of even the most tempting buying opportunity.

But, how do you go about researching and selecting the right markets? How can you estimate stable demand?

I’ll be answering these questions and more in my upcoming webinar, “Picking Top-Notch Markets” on Thursday, February, 21 at 1:00 pm EST.

You can register for the webinar here.

I’ll be speaking for about an hour, followed by a question-and-answer session. Come prepared with questions to ask. You can also submit your questions when you register for the webinar.

Photo Credit: GDS Infographics cc

I always emphasize to my clients the critical value of painstaking market research and selection before considering individual prospects. Simply by conducting thorough research, you immediately separate yourself from the majority of company buyers and place yourself at an important competitive advantage.

Choosing Market Criteria

Choosing the correct market criteria may be tricky. Here are some guidelines for building effective market selection criteria, based on years of practice with clients in a variety of industries.

1. Focus on strategic aspects early. For example, if your one reason for acquiring is to bring a current competency to a new market, you want to make sure that whatever new market you buy into is growing sufficiently. In this case, growth rate should be one of your earliest criteria.

2. Be realistic about the availability of information. You may not be able to immediately get the sales figures for the previous year. Don’t worry, as you progress, you will gather increasing detail about the market. In the  beginning, you can make do with relatively broad information.

3. Limit yourself to no more than six criteria. If you have more than six criteria you can lose focus on the most meaningful strategic aspects. However, each individual criterion may have multiple metrics.

4. Make it measurable. When conducting your research, establishing target metrics for each criterion gives more power and focus to your decision-making process.

Establishing the appropriate criteria will help you guide your company’s strategic growth initiative.

Join Capstone CEO David Braun as he continues the Capstone Strategic Webinar series with insights into the Mergers & Acquisitions market and how you can grow your business.

Picking Top-Notch Markets

There is a unique opportunity in the next 12-15 months to grow your business through M&A.  However, before you start to go after acquisition prospects, you need to make sure you are looking in the right markets.

David will speak for approximately 50 minutes followed by a Q&A session.

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It is common for a business owner to comment about how many times they have been approached about selling their business, particularly if it is a successful one. So in the not-for-sale market of M&A, how do you as the buyer break through the noise and competition?

Recently we had a client looking for a strategic acquisition, and as we sifted through the short list of attractive prospects we ran into an owner that simply would not return our calls about their interest in selling. After numerous tries we sent him a letter explaining our intention, why his company was an attractive strategic fit, and that we would appreciate a moment of his time to further explain our client’s intentions. Within a day the owner of the prospective company called and shared with us that he receives calls weekly about selling his business, and the reason he was returning our call was because he appreciated the fact that we had done enough homework not to waste his time.

What this story shows us is what we already know – owners’ time is precious. Have a well-crafted story about how you see value in their business and a plan to carry on a company that they care about.

Capstone Webinar: Discovering the Right Markets for Growth

David Braun, CEO of Washington, DC- based external growth consulting firm Capstone, is hosting a webinar with Capstone Senior Analyst Matt Craft.

There is a unique opportunity in the next 12-15 months to grow your business through M&A.  However, before you start to go after acquisition prospects, you need to make sure you are looking in the right markets.

David and Matt will discuss Capstone’s unique market-driven process, which centers around future demand:  What will your customers want in 5, 10 or even 15 years?  Anticipating this demand is a key to future success.

In order to determine what that demand will be requires research.  The webinar will delve into where to begin with research and how to use limited resources to get the critical information you need to make a decision.

There will also be insights on how important research into market trends is to ensuring you are targeting the best companies to acquire.

After completing this course, you will be able to:
•    Define the Market-Driven Process and why it makes sense for your company
•    Explain Market Criteria (including market growth and size, competitive dynamics and barriers to entry) and how to use  criteria them to evaluate a market or segment
•    Describe effective Secondary and Primary Market Research techniques to maximize your research resources
•    Explain the Triangulation Technique for market research to get the most relevant information to make decisions
•    Begin to develop Specific Tools to objectively compare and contrast markets

David and Matt will speak for approximately 50 minutes followed by a question-and-answer session.

Date:  Thursday, May 20, 2010
Time: 1:00 PM ET/ Noon CT/ 11:00 AM MT/ 10:00 AM PT

No Prerequisites or Advanced Preparation needed!

To register, click here:  https://www2.gotomeeting.com/register/859711747

Registration Fee: $79

IMPORTANT PAYMENT INFORMATION:  Once you register, we will send you a request for payment via PayPal (may take up to 24 hours).  Once payment is confirmed, your registration will be approved and you will receive the log-in information for the webinar.

CPE Credits – 1 CPE credit in Business Management and Organization will be given for those attending this webinar
Program Level:  Basic
Delivery Method: Group Internet-Based

Please feel free to forward this information on to anyone who might be interested in corporate growth strategies.

Refund policy: Requests for refunds must be received in writing by 1:00 PM ET Wednesday, May 19 and the money will be refunded in full within 5 business days.  After 1:00 PM ET on Wednesday, May 19, a credit will be given for a future webinar.  In the event of a cancellation, you will be given the option of of a full refund or applying your fee to a future webinar.

For questions or concerns, please contact Matt Craft, Capstone’s Marketing Coordinator, at 703-854-1910 or mcraft@capstonestrategic.com

Capstone Strategic, Inc. is registered with the National Association of State Boards of Accountancy as a sponsor of continuing professional education of the National Registry of CPE Sponsors.  State boards of accountancy have final authority on the acceptance of individual courses for CPE credit.  Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 4th Ave N, Suite 700, Nashville, TN, 37219-2417. Website: www.nasba.org

for-saleA recent New York Times article, “How to Sell Your Business” provided some excellent advice about how to sell your own business. It recommended assembling “a team of professionals..an attorney and an accountant that you trust”. This is good counsel and should be followed by anyone selling, or buying, a business.

However, the article also suggests using “For Sale” forums, such as Internet sites listing businesses for sale, suggesting that “most savvy buyers” research the Internet to find businesses for sale.  I strongly disagree with this.  Why would you just set your business out on a shelf like yesterday’s bread?   You should use hire a professional firm that specializes in finding businesses that meet the buyer’s specific criteria for growth, fill a need, or are otherwise the “right” company to buy.

The Internet cannot do that and for-sale business bulletin boards cannot do that. In fact, many so-called business brokers cannot do that either. It takes the right kind of experienced firm, with a proven process and in-depth research capability to identify, research, qualify and close the “right” company. Most sellers only sell a business one time and they should beware of claims that make it sound easy – it’s not.

I recently appeared on Jacobson & Katz: Inside Maine Business to discuss the current state of the mergers and acquisitions market, as well as the Capstone approach to the M&A process.

You can view Part One here:

And Part Two, here:

To see other episodes of Jacobson & Katz: Inside Maine Business, visit www.insidemainebusiness.tv

looking-aheadWith the shaky economy, I am constantly hearing clients talk about how to get through the tough times now.  While this is obviously a valid concern, I caution them not to forget about the future – specifically future demand.

Future demand is king for reasons that are self-evident, once you pause to think about it. Ultimately your growth will depend on your success in meeting the needs of customers you have yet to capture. What do they want today? What will they want in the future? Business winners are the ones who best answer these two questions, especially the second. At Capstone, we put painstaking effort into market research, and go to great lengths our attempts to predict future trends.

Once the orientation has shifted to future market demand, a tremendous clarity emerges in the strategic process. We have a basis for defining our criteria for decisions like: which direction to grow, which growth tactics to adopt, where in the market to focus and what to add to our current resources.

Although times may be tough now, your success as a company depends largely what plans you make for the future.

This Friday, February 20, I will be holding a free webinar on “Finding the Right Markets for Growth” at 1:00 PM ET.   You can register by clicking here.

In these tough economic times, market research and selection are vitally important to position yourself for growth now and in the future.

Capstone Program Manager Gretchen Johnson will be joining me to present on the following topics:

– Current State of the M&A Market
– How to Determine Where the Opportunity Lies
– Why to Research Markets First
– Developing and Implementing Market Criteria
– Market Segmentation
– How to Conduct Effective Market Research

    The webinar is free and open to the public.  Gretchen and I will speak for approximately 45 minutes followed by a 15 minute question and answer session.

    Here, again, are the details.  Please join us!

    Date: Friday, February 20, 2009

    Time: 1:00 PM ET/ Noon CT/ 11:00 AM MT/ 10:00 AM PT

    Registration:  https://www2.gotomeeting.com/register/460174264