For many founders, getting acquired is the ultimate goal. A successful startup acquisition will help you scale your business to new heights and maximise your return on investment. You’ve worked hard to build your startup and deserve to reap the rewards!

The global M&A industry reached a record-breaking $5.9 trillion in 2021 and the market continues to prosper in 2022. There has never been a better time to sell a business!

So what do you want from a startup acquisition? For most business owners, it’s the ability to sell quickly, easily, and for the best price. If you’re looking for advice on how to sell your business, you’ve come to the right place!

We’ve put this blog together to guide your startup journey and help you achieve what you want from an acquisition.

Step 1: Set acquisition goals

The first step is to identify your acquisition goals. Do you want to sell one business and dive straight into another? Are you hoping to achieve a six or seven-figure exit so you can retire?

Once you know what you want to achieve from the sale, you’ll be able to create a strategic plan and start working towards your goal. Make sure you have a clear understanding of how much you want for your startup and any other conditions you would like to be met.

Step 2: Make your startup attractive to buyers

You will attract more buyers and command a higher price if your startup is in prime condition to sell. So, address any weaknesses and focus on the elements that will make your business attractive to potential buyers.

• Get your records in order: Buyers will scrutinize your legal, financial, and HR documents during due diligence. Ensuring they are accurate and transparent will build trust and protect your business valuation.

• Maintain good finances: Invest in technology to streamline your business finances and keep a clear record of past earnings and financial forecasts.

• Create SOPs: Implement Standard Operating Procedures (SOPs) to streamline and optimise your business operations. Your goal should be to create a set of efficient processes that can easily be taught and replicated.

• Prioritise company culture: Buyers look for businesses with good company culture and staff that are engaged and productive. Creating a loyal team and strong company values will impress potential buyers and give you a competitive advantage.

Suggested reading: Everything you need to do to sell your startup

Step 3: Get advice from M&A Experts

Navigating the M&A process is complex, and working with an M&A broker or M&A advisory expert can streamline the entire journey. They provide step-by-step expert support, helping you avoid pitfalls, speed up the sale, and achieve the best outcome.

Many founders worry about the costs of hiring an M&A broker or business broker, but their expertise can add significant value, often resulting in a higher sale price and smoother negotiations. When considering how to sell my business, partnering with the right advisors can make all the difference.

TIP: Interested in expert support? Platforms like Foundy give you access to experienced M&A advisors and legal professionals who can guide you through the process.

Step 4: Get your valuation right

One of the most critical factors in a successful acquisition is getting your business valuation right. Of course, you don’t want to undervalue your startup, but you must also be realistic and strike the right balance. Getting your business valuation right is key!

While applying a revenue or EBITDA multiple is a common method for valuing startups, it’s important to recognize that startup valuation is more art than science. You need to account for additional factors such as market demand, your customer base, brand equity, and data-driven insights into industry trends.

It’s also worth noting that Foundy provides clients with our proven Triangular Model, which leverages expert advisors and data-driven insights to ensure you receive the most accurate valuation possible.

Startup valuation is more an art than a science

Founders often evaluate their startup’s worth by applying a multiple to revenue or EBITDA. This seems logical, but there isn’t a straightforward formula to follow when valuing your startup.

You need to consider additional factors such as consumer demand, customer base, brand reputation, and anything else that makes your startup unique.

Suggested reading: 5 ways to negotiate the highest startup valuation.

Step 5: Join a startup selling platform

Traditional business brokers can charge commission fees between 7% and 15%, but selling through Foundy offers a cost-effective alternative without sacrificing deal quality.

Early preparation is the key to acquisition success

If acquisition is your goal, start planning as early as possible. The sooner you prepare, the easier it will be to navigate the sale process and avoid last-minute surprises. By following these steps, you can increase your chances of a smooth and successful acquisition:

• Define your acquisition goals clearly.

• Ensure your startup is in excellent condition to command the best price.

• Work with M&A advisory experts to guide you through the complex stages of negotiation and valuation.

Remember, early preparation gives you leverage and maximizes your exit potential.

Join Foundy to Accelerate Your Exit

With over 1.1 million transactions worth of data available, Foundy’s platform offers unparalleled insights and tools to help you achieve a successful sale. Our step-by-step expert support ensures that your business is acquisition-ready from day one.

Additionally, Foundy’s M&A advisory services cover a range of industries, making the process smoother whether you're aiming for a funding round or planning to sell your business. We help you every step of the way, starting with a free business valuation. Foundy assesses over 29 key elements to ensure an accurate and comprehensive business valuation.

Ready to discover your business's value?

Selling or acquiring a business can feel like juggling two full-time jobs. While some founders prefer the independence of navigating the process alone, others find immense value in collaborating with experienced M&A brokers and industry professionals. This is why Foundy offers an advanced portal and the Find An Advisor programme to ensure you receive the tailored support you need.

Check out our free valuation calculator on our pricing page, and see how Foundy can add six to seven figures in additional value to your business.

Whether you’re just starting your exit planning or ready to dive into the acquisition process, connect with Foundy to access the tools and expertise needed for a smooth and profitable sale.

No matter where you are on your business journey, connect with Foundy to access the resources needed for a smoother acquisition or sale process.