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

How to sell your Company

By Michael Schmid

How to sell your Company

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