How to sell your Company

Michael Schmid

How to sell your

company

How to sell your

friends

How to sell your

legacy

Why?

• Retirement / Moving on
• More cash
• Expanding customers / markets

Types of deals

Bank Investment

• "Just Cash" for Shares
• Limited access to network
• Owners fully involved

Venture Capitalists

• Mostly Cash based
• Need High Return
• Access to Network
• Owners fully involved

Merger & Acquisition (M&A)

• Cash & Share based
• Deals very individual
• Access to customers & network
• Owners involvement tbd

amazee.io Story

amazee.io Story

• Started 2015 from within Amazee Labs
• Part of Amazee Holding
• Self funded through Holding
• Competitors: 100+ employees & VC baked
• Covid forced us to rethink Holding structure

2020

• Realized we need some kind of Cash injection to compete
• Talked to some VCs & Banks
• Decided for M&A
• Start of selection of M&A Advisors
  • 3 Advisors in short list

2021

• March 2021:
  • Decision on M&A Advisor
  • Communication to team
• April-Sept 2021
  • M&A understand our business
  • Creation of
    • Teaser: 1 Page (no company name)
    • Information Memorandum: 45 Pages

Information Memorandum (IM)

• 250 possible companies
• 120 short listed & Teaser sent
• ~30 interested, NDA signed, sent IM
• First meetings with M&A Advisor & CEO

Mgmt Meetings & Demos

• Buyer driven
• Meetings with specific people
  (no team and customers yet)
• Technical Demos
• On-Site Meetings
• Like Selling & Dating

Term Sheet

• Similar to Offer Letter for House
  • Price (Shares / Cash)
  • Payout Scheme
  • Other important parts
• Includes Negotiations
• Exclusivity after that

Due Dilligence

• 200+ Documents
• Contracts (Employee, Clients, Vendors)
• P&L Statements
• Board Meeting Minutes
• Founding Documents
• Legal Disputes
• New Projections

Reverse Due Dilligence

• Very Little
  (much higher trust in Buyer than Seller)
• Received Yearly Board Update Document
• Mostly should be done already before

Share Purchase Agreement

• 80+ Page Legal Document
• 8 Lawyers, 20+ Assistants
  • Buyer US
  • Buyer CH
  • Seller CH
  • Timezones
• Changes last minute

Signing

• Proxy Documents sent around the globe
• Physical exchange of signed Documents
• Wire Transfer
• Communication to Team & special Customers
• Wire arrives
• Press Release

Timeline

Our Deal

• 50% on Closing
  • 15% Holdback
• 50% on Goals achievement
  
• Options for every Employee
• Additional Options for Key Employees

Commitment?

• No contractual obligation to stay
• Leaving: Loss of options but not Deal
• High risk to not reach Goal
• Therefore indirect commitment

Learnings

Learnings

• Have your stuff together before
• Get an M&A Advisor
• Be ready for a wild ride