Are you thinking about buying a business? Maybe a friend had recent success, or maybe you even heard about business buying opportunities on a podcast (like The Deal Board?).

No matter the reason, the search begins! Learn more about the steps you should take below.

Step 1: Define Your Criteria

Whether you just want to see what is available or you already have an industry in mind, in order to make your search more productive, define your business criteria before you begin searching by asking yourself these questions:

1. What is your budget?

2. What industries are you attracted to?

3. Where geographically are you willing to work?

4. What are you willing or able to do in a business (or not)?

5. Do you have special experience or licenses that you can bring to a business?

Once you have these determined, you can find businesses for sale in three major places. If you aren’t quite sure where to start with these questions, it might be worth seeking the assistant of a business broker. They can provide guidance around how businesses are priced and what is actually available.

Step 2: Finding Businesses

Business for Sale Websites

Your first step is to register yourself as a buyer and sign up for listing alerts around your search criteria on some, but not all, of the many business listings sites. There are also specialty websites for micro acquisitions and e-commerce acquisitions, but here are our recommendations to get you started:

• Bizbuysell.com
• BusinessBroker.net
• Bizquest.com
• Flippa.com (for micro technology only)
• Aquire.com (for micro and technology only)
• Axial (for larger deals, $1MM+ EBITDA)
• Tworld.com

Business Brokers and Their Networks

Business brokerage offices can be talking to hundreds of entrepreneurs a month to see where they are at in their exit process. Often a  brokerage or investment banking firm will receive a business for sale and already have buyers lined up in their database ready to go. If you are one of those buyers, you will have first shot at deals before they go to market! So, knowing the right business broker or investment banker in your target geography or industry is critical.

It’s also important to know that most business brokers (who typically represent companies priced $10 MM or under) are generalists, meaning few specialize in one industry, they are more niched in on size of deal and geographic location. However, investment bankers (who represent companies priced over $10 MM) are usually focused in 1-3 industries, but geographically diverse.

Industry Associations and Contacts

If you are not involved in your target industry, you can join the industry association, attend conferences and let people know that you are a new player that is in acquisition mode. If you are already involved in the industry you want to make an acquisition in, you likely already know the players. Make it known that you are in acquisition mode and you never know what opportunities will land in your lap!

What doesn’t work

So, we covered ways that you can actively draw opportunities to you, but what doesn’t work? Prospecting business owners through cold calls, direct mail, and showing up on their doorsteps. Getting a single solicitation from an unknown buyer is likely not going to receive a call back when they have options with larger buyers or networks  These business owners are usually already being solicited in these methods by the business brokerage industry and larger buyers like Private Equity Firms and Corporate buyers. It can also prompt them to bring the business to market and create competition for you. At the end of the day, it can yield a result but it’s like searching for a needle in a haystack – and you are trying to be efficient!

Conclusion

Hopefully, this short post gave you a starting point in finding businesses for sale. If you are active in the process, we recommend you register as a buyer in our database so you can be alerted to listings for sale, or contact us to connect with a broker!