Possibly the most important (and stressful!) events for an entrepreneur is the acquisition process. Startups and other companies considering an exit strategy are wise to lay the foundation in advance of even considering possible options to sell the company. The pace of acquisitions is increasing significantly in Silicon Valley and the San Francisco Bay Area as the economy continues to prosper.
Having a good CFO is crucial to the acquisition process and may help to increase the valuation on the company due to the improved quality of the process and information. The article below from CFO Magazine highlights some of the key areas to consider in preparing a startup or company for a potential sale.
Some of the key areas include:
Project a Professional Financial Profile: GAAP Income Statements, Balance Sheets, Cash Flow Statements
Provide Forecasts and Business Plans: 5-year period by month with specific KPIs and key metrics
Communications with Constituents: VCs, angel investors, shareholders, employees, partners, etc.
Make Sure Legal Affairs Are in Order: Contracts, agreements, documents, due diligence, etc.
Protect Intellectual Property: Documentation, employees, consultants, etc.
Understand the Closing Landscape: Manage consents from various partners and key players
Clean Up Messes: Contracts, litigation, employees, partners, etc.
Manage Skeletons: Everyone has them!
Negotiate Key Deal Points at the Point of Maximum Leverage: Valuation, employment, employees, non-compete, etc.
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