Partnering with minority investors with M&A expertise can bring your business significant advantages, when it comes to scaling, raising growth capital and optimising your exit.
If you want to realise the full potential of the partnership and to achieve a successful exit, you need to make the very most of the arrangement:
✅ DEFINE YOUR BUSINESS GOALS UPFRONT
Clearly articulate your objectives from the word GO. Are you seeking funding to expand? Identifying an acquirer for an exit? Optimising day-to-day operations? Alignment on desired outcomes is critical, but keep an open mind about ‘how’ to achieve what you want.
✅ LEVERAGE THEIR NETWORK TO UNLOCK CONNECTIONS
A major advantage is tapping into your partner’s connections. Ask for introductions to potential buyers, other investors, preferred lenders, service providers and other entrepreneurs.
✅ ENCOURAGE PROACTIVE STRATEGIC INPUT
Get input from your partners regularly. Their outside perspective on growth opportunities, talent needs, new markets and solving problems in general, can be invaluable.
✅ MAINTAIN OPEN COMMUNICATION
Create open channels for giving and receiving feedback. Be receptive to tough messages about what’s needed to reach your goals. It won’t always be comfortable to hear.
✅ HOLD EVERYONE ACCOUNTABLE FOR RESULTS
While partners can provide guidance, you need to hold them accountable for delivering measurable outcomes, according to the agreed engagement terms. Always define success clearly.
✅ INCENTIVISE ULTIMATE SUCCESS
Make sure that all parties are highly incentivised to get the best possible outcome. Sounds obvious, but this needs to be understood and accepted, for the entire partnership to function properly.
✅ DRAW ON THEIR PRIOR DEAL EXPERIENCE
Leverage your partners’ expertise gained from past deals. Learn what other SMEs have done to maximise outcomes in similar situations.
✅ TAKE A LONG-TERM APPROACH
If the personal chemistry between business owner and investor is poor at the very beginning, don’t expect any real improvement during the inevitable ups and downs of the partnership. Consider this – before signing on the dotted line.
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