NorthStar's Acquisition Accelerator
Making It EASY for Buyers to Buy a Business
Getting You to "No" as Quickly as Possible
Did you read that correctly? Getting to a “no” as quickly as possible? Wouldn’t we prefer to get to a “yes” instead? While this all may sound counterintuitive, the reality is that the vast majority of buyers looking to acquire businesses are going to investigate dozens, if not hundreds, of opportunities and spend months going on years in order to find just a handful of suitable companies to even give a deeper look. So how can we be the best resource for you and relieve as many of your pain points as possible? You guessed it – getting you to a “no” quickly.
Built Around Two Simple Priorities
NorthStar’s Acquisition Accelerator system was developed with two key objectives in mind that work in concert with each other:
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Don’t Waste a Buyer’s Time
We know how many deals you’re looking into, how valuable your time is and how used you are to the idea of “hurry up and wait.” So we built our proprietary Acquisition Accelerator system to be fast – lightning fast! That way you’re able to make an expedient decision about whether or not the opportunity fits your criteria and if moving forward makes sense.
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Don’t Waste a Buyer’s Effort.
We know how frustrating it is to receive incomplete, inaccurate or insufficient information on a target opportunity. So we built our proprietary Acquisition Accelerator system to provide enough insight, data and access for you to perform pre-diligence on a business in a matter of days. That way you can make an informed decision about whether or not moving forward makes sense.
Expedient and Informed.
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That’s what buyers can expect when
working with NorthStar!
NorthStar's Rule of 50%
NorthStar’s Acquisition Accelerator isn’t complex, but it is systematic. The 10 steps outlined below offer you some insight into what you can expect when you look at a business with NorthStar. But what is the Rule of 50%? Simply put, we expect that at every stage of the buyer process, we’ll lose about 50% of the interested buyers before moving on to the next stage. And that’s a good thing. It means buyers are receiving enough quality information to make informed decisions about moving forward – not wasting their time, our time or the seller’s time in the process.
Here’s more on NorthStar’s Buyer Process …
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Search
Filling up your funnel with interesting opportunities
It’s not hard to find our deals if you’re looking – in fact, it’s not hard to find our deals even when you’re not looking! Every new acquisition opportunity we bring to market is first offered to the buyers in our database. As a member of NorthStar’s Buyer Bulletin, you’ll receive targeted pre-market opportunities based on your provided search criteria before the general public sees them. We also send out regular listing updates with news on multiple opportunities to our entire buyer database to make sure you’re seeing everything we’re working on. To gain access to these announcements, join NorthStar’s Buyer Bulletin.
Confidentiality Agreement (the CA)
Protecting the Seller’s confidentiality and sensitive information is critical
There should be no surprise about this next step. The business you’re inquiring into is likely the seller’s heart, soul and livelihood. Providing literal strangers with sensitive and confidential information about that business is not only scary, but also risky. This is a vital and mandatory step to get any additional information about a business opportunity outside of the confidential public details already provided. The good news is that NorthStar makes this process quick and
painless. Within seconds of expressing interest in one of our listings, you’ll receive an email with a link to sign our CA electronically from your phone, tablet or computer.
Confidential Information Memorandum (the CIM)
Your first deep dive into the operations and financials of the business
NorthStar’s CIM is vastly different than what you have likely come to expect from most M&A firms. We take the time to not only include the basic information you need for an initial review, but we also curate unique and critical narratives about the business operation, seller responsibilities, customer base, revenue mix, key employees, growth opportunities and other insightful details to assist you in truly getting a vision of what the company is all about. We also
include an extremely thorough financial packet in the CIM, as we understand the importance of sinking your teeth into this data immediately.
Confidential Video Presentation & Owner Interview
Your first opportunity to “meet” the Seller
Once you’ve had the opportunity to review the CIM in detail, you’ll be offered the option of requesting access to the Video Presentation & Owner Interview on the company. If you’ve made it this far and are still interested in the business, we know you’d love to meet the seller and see the business facility. Unfortunately, that’s just not a viable step at this juncture given the sheer number of prospective buyers we are working with and the seller’s lack of available time to
meet with everyone. So with that challenge in mind, we developed the idea of this intermediate step, allowing you to “meet” the owner and see the facility without demanding an inordinate amount of the seller’s time. This secure, password-protected video is an amazingly effective tool. In a seller’s own words, you get to understand what the business does and how it does it, you get to feel the passion the seller has for the business and you start to gain some clarity
about whether or not you can see yourself working with this individual and running this business.
Buyer Qualification Meeting with NorthStar
Let’s make sure you’re a good fit for this business
After watching (and likely re-watching) the Video Presentation & Owner Interview, you certainly have many more questions - we want to hear from you! Before either of us do anything else and start committing more time and effort to this investigation, we ask you to schedule a Buyer Qualification Meeting with the seller’s representative, which can be virtual or over the phone. This step accomplishes two primary objectives. First, you’re able to ask some more detailed questions about the business that haven’t been covered yet – chances are, we’ll know the answers, but if we don’t we’ll get you the answers quickly.
Second, it gives us a chance to better understand you, your search criteria and if this opportunity is a good fit for you. Going into this meeting, we know what the financial requirements are to make the purchase, as well as the experience and skills necessary to be successful running the business. Before we move to the next step and ask the seller to take time away from the business to talk with you, we need to be confident you meet the basic criteria to successfully acquire and operate the company.
Management Meeting with the Seller
Time to start building rapport
While there are dozens of factors that go into completing a successful business acquisition, none may be as important as the relationship between the buyer and seller. The Management Meeting is the first opportunity for that relationship to begin developing. Mechanically, this meeting is ideally a video call, and is designed to be a mutual interview of sorts. As much as you want to learn about the seller and dig into more complex business details, the seller uses this
meeting as a chance to start considering what a transaction and ultimate business transition would be like with you. This is not the time to discuss deal terms, but rather an opportunity to be curious, complimentary and comprehensive in your discussion with the seller.
Pre-Diligence Review
Now the ball’s in your court
At this stage of the Acquisition Accelerator, you’ve jumped through every hoop we’ve asked you to, and hopefully you’ve also gained a level of appreciation for NorthStar, our process, the seller and the business. Now we’ll ask “what can we do for you?” Although you probably have enough information and understanding regarding the business to draft and propose a purchase offer, we want you to be absolutely certain you’re comfortable with that decision. Maybe you want to
visit the facility, maybe you’d meet the seller in person, maybe you need a few additional financial reports to review, maybe you have some more detailed follow-up questions – whatever it is you need in order to produce a purchase offer that you can stand behind, now’s the time to ask for it. Again, we appreciate your cooperation getting to this juncture, and now we want to know what we can do for that hasn’t already been adequately addressed!
Purchase Offer & Negotiation
A successful closing begins with clear deal points
A major mistake many buyers will make in drafting a purchase offer is attempting to contemplate the entire transaction in what should be a bare-bones, to-the-point agreement. Remember, a letter of intent (LOI), or other purchase offer, is a non-binding term sheet designed to create an agreement between the buyer and seller on a handful of major deal terms, and a stepping-off point for the buyer’s due diligence. But there are some fundamental items that must be included in your LOI. Obviously the first thing everyone looks for is the purchase price. But just as important are five additional points that need to be addressed – deal structure, timing and deadlines, funding source, payment terms and post-closing transition. The fact is, “you don’t know what you don’t know” at this stage, which is what due diligence is for. There are several inherent terms of a final purchase agreement that are better suited for discussion and negotiation during due diligence, not when you’re presenting an LOI. Read more about “5
Things to Include in Your LOI (Other than the Purchase Price).”
Due Diligence
Your invitation to join the seller in NorthStar’s Transaction Navigator™
Running concurrently with your progression through the Acquisition Accelerator system, the seller has long-been engaged in NorthStar’s Transaction Navigator™. Due diligence is where those two paths officially converge and we all begin pulling the rope in the same direction – towards a successful closing! NorthStar’s due diligence management system, the Transaction Log, stands second-to-none in the industry. Just as you’ve become accustomed to a certain level of service and professionalism with the Acquisition Accelerator, the Transaction Log is designed to be proactive, fast and efficient, while also offering the level of scrutiny, thoroughness and responsiveness required for a buyer to satisfactorily complete the due diligence process. NorthStar will captain the ship through the entire due diligence journey – weekly cadence calls, financial, operational and legal review, acquisition financing, legal document preparation, lease negotiation, account transfers, insurance requirements and every other aspect necessary to go from executing the offer to closing the transaction.
Successful Closing
We don’t let those final, critical details delay this celebration
Many people have a misconception about the actual closing of a business acquisition, believing that it’s a moment of calmness to exhale between the chaos of due diligence and the flurry of the upcoming transition. The reality, however, is that the craziness continues right to the closing table! No matter how prepared a buyer and seller are for the actual act of closing their deal,
there are always last-minute details that cannot be left to slip through the cracks. We help ensure that those issues remain top-of-mind and get reconciled, rather than becoming unwanted surprises. Closing should be a moment of celebration by and between a seller securing their dream exit and a buyer embarking on the next stage of their own dream – NorthStar is there to see to it that everything is in order and nothing derails this momentous event!
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