Sometimes, the very best candidates to buy your business can be found on your customer list.
Your customers already know and trust you and your business.
What’s more, since they can save the money they spend with you if they own your business, they have a built-in reason to buy it.
It’s happened before. Take a look at Help A Reporter Out ( HARO) – a company that Peter Shankman started almost by accident.
One day, a journalist friend asked Mr. Shankman – a former public relations guy with a thick Rolodex – if he knew an expert source for a story he was writing. Mr. Shankman sent the journalist’s request to his database of e-mail addresses and was able to find an expert keen to be quoted for the story.
The journalist must have told a few of his friends because soon Mr. Shankman was fielding dozens of queries from journalists on deadline needing an expert source to quote.
In 2007, Mr. Shankman set up a Facebook group to streamline the process of connecting journalists with expert sources. The volume developed to a point where, Mr. Shankman says, “we outgrew Facebook.” He decided to set up his own website in 2008.
Within three months, Mr. Shankman’s site and company had 10,000 members. One of his largest advertisers was Vocus Inc., the parent company of PR Web, a business that distributes press releases on the Internet.
After advertising steadily for more than a year, Vocus approached Mr. Shankman last year about buying his business. Since the two companies knew each other well, Mr. Shankman and his counterpart at Vocus were able to hash out a basic set of deal terms over two martinis at Morton’s steakhouse in Manhattan.
A few weeks later, without shopping his business or enduring a lengthy and emotional negotiation cycle, Mr. Shankman sold his company to Vocus.
The entire process, from HARO's site startup to its sale, took two years.
Mr. Shankman’s story serves as a good reminder that sometimes the best suitors will not be found on your list of competitors or suppliers but among your customers.
Special to The Globe and Mail
John Warrillow is a writer, speaker and angel investor in a number of start-up companies. He is the author of Built To Sell: Creating a Business That Can Thrive Without You, which will be released in April.