Selling a business and choosing an agent

[rjp77]

I've run a growing business for 6 years that I've had valued by accountants reliably at circa £1.4-1.6m. I'm looking for an exit but having a nightmare choosing a sales agent. As its such an unregulated industry and everyone charges a fee upfront its been a case of eliminating the rouge ones and trying to find one that will follow through. This value puts us on the cusp of the "corporate" agents who work databases of clients etc rather than the smaller "advertisers" who simply advertise and see what interest they get. I've whittled it down to:

BCMS
Benchmark
KBS Corporate

Does anyone have any experience using these companies or has good personal experience with another you can recommend?

 

[Clinton]

I maintain the UK's largest knowledge base of business brokers. If I were you I wouldn't use any of those three I'm afraid. I do offer a service to match business owners with brokers including creating the right shortlist of brokers (no, not the BCMS / KBS type that you find in Google), negotiating the price and terms with the client's chosen broker and advising all through the process. But I charge good money for such advice.

 

[The Byre]

http://www.mirror.co.uk/news/uk-news/business-transfer-agents-time-government-3288539

https://www.yelp.com/biz/bcms-corporate-new-york

 

[Clinton]

I know Andrew Penman who wrote the Mirror articles. To be fair, I think the OP recognises this issue of transfer agents and is one step above the type of business owners who fall for the lower end of the broker market.

However, he has ended up with the next level of broker - the smooth operators such as BCMS and KBS who do a very good pitch. BCMS, for example, run seminars that can appear quite impressive (to someone who doesn't know the market well). However, the dangers with firms like these are different to the ones Andrew Penman typically covers in his various Mirror articles. For one, the fee BCMS charges is not economical for a business of this size (I've got broker fee analysis here). BCMS often quote £44,700 + VAT (or £15K+VAT if it's their lower stream). KBS is a lot more affordable for a business this size - they charge £5K + VAT - but there are other reasons why KBS isn't a good choice (and not just because they're on the verge of an IPO).

Benchmark's fees are negotiable and fall between the high end BCMS charges and the flat fee of KBS. I know a lot of people at Benchmark, including their MD, and their CMO has even kindly written me a recommendation in LinkedIn. But I'd advise that the choice of broker needs to be done with a great deal of care; for any individual business there are a very, very few brokers that are a good match. And the chances are you won't find them in Google as Google will lead you to the KBS and Benchmark type brokers who spend a lot on SEO and SEM.

 

[Rafael Mediator]

My colleague at Maximiti sold his company formations business through Benchmark. Although he recommended to Benchmark which companies to approach as the sector is very specialised, they were very good as intermediaries; they achieved the target price and were good to work with.