"Investment Banking is 10% Financial Analysis and 90% Psycho-analysis" – André Meyer  This blog is about the "other 90%"…

Start it, build it, sell it

01/23/2012  | 

“Well begun is half done”, said Aristotle. This is true also for building sellable companies. However, good selling takes another 50% of effort, which takes it to 150%.

Am I serious? How could selling add so much value? Many believe selling adds no value at all. Make a good or well priced product and it will sell itself.

Depends where selling begins and ends.

True, some type of selling adds little if any value. This gives business brokerage a bad name. How much added value is there selling quoted stock? Business brokerage, at its best, is peddling connections. At its worse, classified advertising at the cost of confidentiality.

At the other end of the spectrum, the sale of a company begins before founding or investing in it.  The approach of serial entrepreneurs and better private equity groups: begin with the end in mind. Treat a company as a product and shape and build it to appeal to the eventual buyer, be it a strategic investor (patents, products, position) financial buyer (cash cow-ness, growth) or IPO (image, vision, story).

In the middle is M&A. True, we do not ourselves grow companies, although, often we keep in touch for years advising prospective sellers building and grooming for the sale.  However, our goal is to add as much value as possible in the timeframe of a sale or capital raising process, being typically 6-12 months.

We add value by positioning, marketing, advising, structuring, preparing, correcting, presenting, up-bidding, managing, negotiating, maximizing, troubleshooting, and running the process… and not least, letting the founder/CEO keep building value and maintain numbers by keeping his eyes on the ball, while we tend to the bidders.

István Préda

István Préda

IMAP MB Partners, Managing Partner

István Préda founded IMAP MB Partners (formerly: Magánbankár Kft.) in 2002. Since then, he supervised more then two dozen successful M&A deals and more then a hundred enterprise valuations. Before striking out on his own, István was head of corporate finance with ABN AMRO in Hungary. Between 1995 and 1997, István was an Associate Banker at the EBRD in London and in Budapest. Between 1991 and 1994, he worked as auditor with KPMG in London. In 1994, he qualified as a  Chartered Accountant (ACA) in England and in 1997, he earned his financial analyst (CFA) charter form the CFA Institute of Charlottesville, Virginia. Since 2007 has been a board member of IMAP. In 2006, he founded Firm Value / Cégérték / Valoarea Firmei and founding author of M&A Hungary blog.

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