EP #52 – Marc P. Bernegger: Selling 2 Companies And Doing An IPO

The Episode in 60 Seconds

Finding the right exit strategy for you and your company.

Getting the basics right

• Look beyond Switzerland for potential buyers
• If you can, get help from specialized M&A boutiques
• Broaden your shareholder base to get easy access to new markets and industries

Selecting the right partner and deal

• Institutional investors usually curtail the entrepreneurial freedom of the founder more strongly than non-institutional investors such as family offices.
• Aggressive growth often leads to the founders being left with very small stakes in the company once the time for an exit has arrived.
• Don’t select buyers based on valuation but based on their values aligning with yours. Don’t forget that most likely, you will still be obliged to work in your company for a few years after it has been acquired.
• The price of an acquisition is often split in a fixed part and a variable part, called earn-out, that gets paid out on defined targets and incentives over the duration of 1-5 years.

Timing
Depends on several factors:

• Can the company still realize significantly more growth in the future?
• Do you still have the passion and energy to drive the business forward?

Exit options

• M&A (Merger and Acquisition): Selling of the companies assets or shares. For smaller companies with revenue generally above $ 10m.
• IPO (Initial Public Offering): Listing of the company on a public stock exchange. Usually not feasible for revenue below $ 200m.