In this episode, about Deal Terms You Need To Know Before Selling Your Company
- The podcast episode discusses the significance of deal terms in business transactions, highlighting that terms can outweigh the price in determining the quality of a deal.
- Different aspects of deal terms are explored, such as closure risk, timing, level of due diligence, time value of money, escrows, and representation and warranties.
- The episode emphasizes the importance of considering the fit of the buyer, the treatment of employees, and the choice between asset sales and stock sales, which can have significant tax implications. Listeners are encouraged to seek advice from advisors for optimal deal outcomes.
Here is a glimpse of Deal Terms You Need To Know Before Selling Your Company
In this episode of The Lazy CEO Podcast, host Jim Schleckser discusses the importance of deal terms in business transactions. He introduces the concept of “your price, my terms,” emphasizing that the terms of a deal can outweigh the price in determining its quality. Jim compares two theoretical deals to illustrate this point: a $20 million deal paid over 10 years with potential deductions versus a $16 million cash deal with no backside risk. He highlights the significance of closure risk, timing, level of due diligence, time value of money, escrows, and representation and warranties in deal negotiations.
Jim also discusses the impact of the buyer’s fit and treatment of employees, as well as the distinction between asset sales and stock sales. He explains that the choice between the two can have significant tax implications and advises listeners to consult with their advisors to determine the most favorable option.
Throughout the episode, Jim shares personal experiences and insights from his involvement in various deals. He concludes by emphasizing the importance of paying close attention to deal terms and seeking expert advice to ensure a successful transaction.
Resources mentioned in this episode:
- Jim Schleckser on LinkedIn
- The CEO Project
- Great Ceos Are Lazy: How Exceptional Ceos Do More in Less Time by Jim Schleckser
Sponsor for this episode…
This episode is brought to you by The CEO Project. The CEO Project is a business advisory group that brings high-caliber, accomplished CEOs together. Our team of skilled advisors comprises current and former CEOs who have run both public and private sector companies across multiple industries. With our experience and expertise, we guide hundreds of high-performing CEOs through a disciplined approach that resolves constraints and improves critical decisions. The CEO Project has helped high-performing, large enterprise CEOs with annual revenues ranging from $20M to over $2 billion to drive growth and achieve optimal outcomes. If you are an experienced CEO looking to grow your company, visit www.theCEOProject.com.