The email in your inbox
Hi <business owner name>
Are you the right person to talk to about exploring a sale of <insert business name>? If not, do you mind pointing me in the right direction?
Warm regards,
John Doe
Action Capital Group
So you received an unsolicited offer to buy your business. Lots of thoughts go through your mind.
Am I ready to be done?
Is this my way out?
Is this legit?
Is it too good to be true?
If I get an offer, how do I know if it is a good offer?
If this does not work out, should I sell my business?
How hard is the selling process? Spoiler: it’s usually harder than expected; only 1 in 4 businesses listed for sale actually sell. Exit Planning Institute
An unsolicited offer feels like a shortcut, but without preparation, most off-market conversations stall or fall apart during due diligence.
An Unsolicited Offer Isn’t a Reason to Sell. It’s a Reason to Prepare.
In business sales, brokers often act as intermediaries. Business brokers specialize in valuing, marketing, and selling businesses. A business is listed anonymously, and a broker works with buyer prospects, navigating questions and offers to find the best buyer fit for the seller.
This unsolicited offer situation is becoming more common for business owners in the United States. Larger companies have found one of the best ways to grow is by buying other companies. They are buying the revenue, cash flow, customer base, employees, and goodwill. This is a faster way to grow than traditional organic growth.
These companies can be private equity groups. Or strategic buyers, a company in a similar or adjacent space. They are looking for strategic additions to their business.
AI has made this outreach easier. Tools now let a buyer (or a VA hired through one) scrape business registries, databases, and LinkedIn to build a targeted list in hours instead of weeks.
AI-drafted, personalized-sounding outreach is cheap to send at scale. So the marginal cost of contacting 500 owners is minimal, giving more buyers access to this tactic.
This is also why owners should expect the emails to look plausible and specific (a named person, a named fund, a reference to their exact niche) even when the sender’s due diligence is thin.
Plenty of money is available to fund this; SBA loans are available and favorable for existing businesses. Going higher, private equity has an estimated $2+ trillion in dry powder available. Statista – PE dry powder
An SBA loan is a small business loan that is partially backed and guaranteed by the U.S. Small Business Administration (SBA). Encouraging more banks to offer business loans.
In today’s world, another buyer is emerging. ETAs. Entrepreneurs through acquisition. It is becoming more accepted that buying an established business is better than starting from scratch. An established business has cash flow, customers, employees, reputation, and goodwill,
To make this more enticing. A buyer can potentially get SBA acquisition lending and put down only a 10% down payment. Buy a $1M business with $100k down.
There is also much talk about the Silver Tsunami, the great wealth transfer from Baby Boomers to younger generations. They own 37% of small businesses in America. More and more, their families do not want to take over the family business. Opening an opportunity for an aspiring entrepreneur to take over.
CNBC – how big is the great wealth transfer, Yahoo Finance – $5T of boomer businesses
Adding more interest is future economic and job uncertainty. AI may take your job; your corporate overlord may lay you off. Owning a business is one way to carve your own destiny.
“Owning a business is not for everyone, and that is ok” is a common phrase I say to almost every buyer prospect who has never owned a business.
A business is a living, breathing entity that requires time and mental bandwidth. It will always be on your mind.
Various influencers on social media channels are pushing the silver tsunami wave, talking about buying boring businesses from tired baby boomers. Many are selling courses on how to buy a cash-flowing business with little money down.
While some are giving out actionable advice, some of the services they sell are what a professional business broker does to earn their commission for a successful business transaction.
Many new parties are trying to insert themselves into the business-for-sale transaction to earn their share. Buyers’ consultants, transaction coordinators, loan brokers, due diligence partners, etc.
All this has created strong demand for good, established businesses. If a business broker lists a strong business that fits many of the desired criteria, we expect a wave of inquiries quickly. That’s not true of every business; typically, only 1 in 4 listed businesses actually sell. Strong demand exists for the less common, well-positioned business. These are businesses that have often spent a few years planning an exit.
So buying a good business can be really, really competitive.
This backdrop brings us back to why business owners are getting unsolicited offers. Buyers are looking to go straight to the source, instead of waiting for something to show up. They target specific industries, locations, etc., in their buy box.
Look closely at most of these emails and there’s no number in them. No price, no structure, no timeline. That’s not an offer. It’s a sales lead, and you’re the lead. That isn’t a bad thing, but it changes how you should respond.
If they find a potential seller, this can reduce or eliminate competition. The seller may also be unprepared or not seek expert guidance. This leads to a better opportunity for a favorable deal.
At a recent business broker conference, we had a panel of representatives from private equity & family offices. When asked about how often brokers are in the deal, there was a pause.
“We like when a broker is not involved; we are not competing for that opportunity. But when a broker is involved, the deal process is much smoother.”
This is often positioned as a good strategy if you are looking to buy a business.
For example: One industry article calls off-market acquisitions the “Holy Grail” of private equity opportunities, characterized by “less competition, better prices, closer relationships, and quicker closing.” Brokered Deals from the Buyer’s Perspective
Because many buyers prefer this path, you need a different playbook than the one they hope you’ll follow.
So, if a business owner receives an unsolicited offer, what should they do?
• First, be flattered; it’s nice to be desired.
• Take a breath before you reply, if you decide to. Probably best to understand what you’re responding to first.
• Don’t sign or agree to anything on a whim.
• Don’t share real financials, customer lists, or account credentials before a signed NDA. A buyer who asks for numbers before offering an NDA is telling you something.
• Be cautious with links until you’ve verified the sender. Brokers are seeing phishing ploys using fake Zoom/Teams links.
• Verify who you’re actually talking to. A name, a title, and a company name in an email signature aren’t verification. A quick search on the person and the firm, and asking directly who else is involved (fund, family office, individual buyer) costs nothing and filters out a lot of noise before you invest time.
– Quick note: individuals will often create websites that portray them as professional investors or private equity-like.
• Don’t tell employees, vendors, or landlords yet. You control confidentiality until you decide otherwise, and premature word-of-mouth can spook staff or key customers over a conversation that may go nowhere.
• Keep a simple written record of the outreach and any calls (name, firm, date, what was said). It costs nothing and matters if things move forward.
• Talk to a business broker; experienced ones have navigated numerous transactions. Also, you don’t know what you don’t know.
• Get a business valuation; learn how much your business is really worth on the market.
– One offer is not the market.
– If you made an unsolicited offer, would you start high and potentially overpay?
– While AI tools can give ranges, they often miss factors that impact the price and demand.
• Ask about deal structure, proof of funds, or financing.
– Asset Sale vs Stock Sale
– Cash at close vs earnout vs seller financing
– Employment or consulting post-close
• Talk to your accountant: cleaning the financials, documenting add-backs, & tax impact.
• Talk to your financial advisor: estate planning, wealth management.
• Talk to a Tax planning expert if your accountant or wealth advisor is not up to the task.
• Talk to a business transaction attorney for counsel and to draft and review legal documents. Make sure they handle business transactions, not necessarily your divorce or will.
• If the buyer tries to pressure you and push on time. Remember, if they want to buy your business, most likely there are other potential buyers.
• If the buyer is trying to keep you from getting advice (“we don’t need lawyers involved yet,” “let’s keep this between us”). A legitimate buyer expects you to have counsel and won’t discourage it.
• Have someone review an LOI (letter of intent) before signing. While mostly non-binding, some parts can be binding.
• Be prepared for some buyers who try to renegotiate after initial terms.
• Consider whether to let a broker test the market against this one offer rather than negotiating it alone. A single offer negotiated one-on-one has no competitive tension behind it.
• Learn about the process of selling a business; only 47% of business owners have ever sold a business before (businessforsale.com). So most know little about the process.
– Talk to a local business broker (Visit IBBA.org / Sellyourway.org, also find one by talking to an accountant, banker, or financial planner)
– Talk to someone you know who sold a business.
– BizBuySell, a business-for-sale marketplace, has information, and you can find an active broker in your local market.
– I created a 12-minute crash course video on selling a business, with links to other helpful articles https://howtosellabusiness.info/
• 1 in 4 businesses listed for sale actually sell
• Normal listing to close is 9-12 months (I have had a few recently take over 2 years)
– Breaking this down:
◦ Prepare to Sell. Business Valuation & Prepare the Marketing Package: 1-2 months
◦ Listing to Buyer Search to Offer: 6-9 months
◦ Offer through Due Diligence to Closing: 2-4 months.
◦ Transition: 1 month or more
• Looking deeper into the Offer to Close timeline of 2-4 months
– Some factors: Full due diligence of your business and its financials, negotiating the purchase agreement, financing contingencies, quality of earnings, lease assignments, etc
• Long story short, selling a business is often difficult with bumps in the road.
• Brokers work with the small business owner to complete the sale successfully while maintaining confidentiality throughout the process.
• Experienced brokers have completed deals and have experience overcoming a variety of obstacles while trying to navigate a transaction.
• Brokers are primarily commission-based. So, they are aligned with a seller to get a deal done for the best price.
• Brokers have relationships with transaction attorneys, lenders, accountants, and other deal partners needed for a successful transaction.
• Consider talking to more than one. You are embarking on an often difficult, stressful journey; you need to make sure you’re a good fit for each other.
• Protecting Confidentiality
• Negotiating something that may be foreign
• Not knowing what your business may be worth on the open market with proper marketing.
• Cost vs. benefit: While you are saving money on commission, is it costing you price?
• Speed of deal timeline: There are a lot of moving parts in a deal; keeping the ball rolling can be a challenge
• Finding good deal partners to work with
Congratulations, you’ve built something another business sees as worth buying. That’s rare, and you only get one real shot to get it right.
If you want a second opinion before you respond to that email, I offer a free, confidential conversation. No obligation, even if you’re not sure you want to sell. We’ll talk through the offer, what your business is actually worth, and what your options are.
As brokers, we see too many owners either leave money on the table or walk into a bad deal, simply because no one gave them a second opinion before they replied.
Ben Shaw
Murphy Business Sales – Wilmington
910-808-1208
No obligation. 100% confidential.
Want to go deeper first?
• How To Sell a Business in 12 Minutes: my free crash course on the full sale process.
• Clean Books, Higher Offers: how to prepare your financials 2–3 years before selling.