We’d like a $ for every time we’ve mentioned that the banks still aren’t lending and the sentence is barely complete when the response comes back something like “I know ! followed by a long story of the short shrift from what’s historically been a friendly banker.
Well we can whinge or we can work around it.
Some ways to address the funding issue might include:
- Sellers offering vendor finance – Ok so not an original thought but has the huge benefit of backing the business to be sold.
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Buyers asking for vendor finance – you don’t ask you don’t get and the appetite for this possibility is being driven by necessity
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Package the business professionally – it is now even more important to present the business, projections and upside in a way that the financiers can easily understand. The business case needs to hit their cash-generating hot buttons
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Consider other funding sources – angel investors want equity and a say but a smaller bit of a bigger pie has to be a consideration
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Staged Acquisition – consider an acquisition over time with a pre-agreed timeframe and terms to provide certainty for both parties