This week’s M&A Access features Philip J. Whitman, CEO & President, Whitman Business Advisors LLC. Whitman explains how his company’s business tool, Practice Growth Multiplier, helps clients generate significant bottom-line profits by adding new clients quicker. He also articulates what the biggest concerns are for his clients at this time.
This week’s M&A Access features Bob Colgan, SVP, Blacksail Capital Partners. Colgan breaks down the themes he has seen from borrowers and investment bankers since the June 30 mid-year mark, including how PPP money has given borrowers time to pivot in the new COVID-19 reality. Colgan also explains how lenders are genuinely open for business and how Blacksail differentiates itself from its competitors.
There is a potentially lucrative group of buyers that many sellers don’t initially think about. We are talking about foreign buyers. While there are some hurdles to working with these types of buyers, it is important to note that there are many huge advantages as well. Let’s take a closer look.
How Are Foreign Buyers Different?
At the top of the list of ways in which foreign buyers are different is that they are often seeking a visa. Another commonality among foreign buyers, one that will surprise many, is that they may want access to the U.S. educational system.
It is common for foreign buyers to want to buy a business so that they can get their children into a particular U.S. school district or college. Sometimes the desire to be eligible for state tuition also plays a role in the selection of a business and the decision-making process. In this sense, business location takes on a level of importance that it might not have for domestic buyers.
It is important to keep in mind that there are cultural and business differences that play a role with foreign buyers. Everything from a different use of business terminology to expectations can play a role. This could impact negotiations.
What About Visas and Immigration?
One of the most important things to remember is that foreign buyers are often navigating the complex world of visas and immigration. Whether or not a visa is issued can dramatically impact whether or not a deal ultimately takes place. This fact is often built into agreements. For example, a purchase condition may be conditional upon visa approval. Nonrefundable deposits may also play a role in the process.
What Do Foreign Buyers Really Want?
Foreign buyers have been impacted by the pandemic too. Yet, some factors remain unchanged. Not too surprisingly, they will want to see that a business is profitable. In this regard, you should be able to showcase profitability in a clear fashion. You can expect foreign buyers to want to see tax returns and all the typical documentation that you’d need to provide to any buyer.
A second factor that foreign buyers are interested in is longevity. If your business has successfully operated for decades, this will be a major advantage.
Ultimately, most of what domestic buyers are looking for in a business will translate over to what foreign buyers are seeking as well. With that stated, however, there are factors that are often unique to foreign buyers. As mentioned above, navigating the often-complex visa process can add a wrinkle to the entire process.
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This week’s M&A Access features Natasha Todorovic-Cowan, CEO, National Values Center Consulting. Todorovic-Cowan discusses how unraveling the people side of organizational problems leads to more successful deals. She also dives into how her research on leadership has led to a 50–300% increase in clients’ leadership capacities and more.