Buyer #1 is new to the industry and is willing to pay a premium for a company with stand-alone strength. They want the owner to be able to manage at an arms’ length from daily operations. This Buyer is not an expert but feels there is an opportunity in your business model so is primarily buying for the ROI.
The other challenge is when buyer does not know how a market sector/company works, they apply risk discount. They reflect that in how much cash on close verses vendor carry. The higher the perceived risk the higher the vendor carry will be.
Buyer # 2 is involved in a related or competitive industry now and is looking to buy market share. When Precision Drilling bought Kenting, Hank Swartout said he did not buy 100 more rigs… he bought 30% of the marketplace over night. That was worth top dollar to him. This Buyer has access to replace whatever skill sets necessary; the existing owners are able to stay for their work agreement and the buyer is able to replace their positions when the timeframe of their agreement is up.
They will maximize how they use you and your partner for first few months, but they will move you out as soon as possible as they will want to do things their way. This buyer requires the least amount of education and is looking for encouragement to take the risks. They will have desire to manage risk but charge forward.
There are always buyers who feel they are smarter than sellers and looking for the right deal. With the average transaction taking a year from when you start, why would you not make progress on every strategy concurrently and cherry pick the deal that works best for you? The time to pursue one or two strategies at a time is MUCH longer than strategically testing the market for opportunities, while you’re reinforcing your team and options.