Received an Unsolicited Offer to Buy Your Business? Read This First

NorthStar Recorded Conversations: Real Conversations About Building, Selling, and Transitioning Businesses

If you’ve built a successful business long enough, eventually someone will approach you about buying it.

Sometimes it’s a competitor.

Sometimes it’s a private equity group.

Sometimes it starts with a simple email or phone call.

For many business owners, an unsolicited offer is the first time they seriously consider selling their company.

The interest feels exciting. It feels validating. It can even feel flattering.

But what many owners don’t realize is that unsolicited offers often come with hidden risks.

Buyers understand the acquisition process. Most sellers don’t.

Without preparation, it’s easy to lose leverage before negotiations even begin.

In this NorthStar Recorded Conversation, Tom Bronson, Jeremy Furtick, and John Gorbutt discuss why buyers make unsolicited offers, where sellers get into trouble, and how business owners can protect themselves before engaging in a transaction.

Q: Why Do Buyers Make Unsolicited Offers?

Tom Bronson:

It really depends on the type of buyer. Every business owner is probably getting phone calls every month from analysts at private equity firms or investment banking firms. They’re doing what we call “dialing for dollars.”

They’re looking for opportunities to buy businesses that aren’t on the market because they know they’re likely to have more leverage in the transaction.

If they can find a really good business that doesn’t have representation, doesn’t have competitive offers, and may not even know what it’s worth, they might be able to get a very favorable deal.

I know because I’ve been on that side of the table.

When I was buying companies, I made it a point to stay friendly with competitors because I never really viewed them as competitors. I viewed them as acquisition targets. Most of our acquisitions came from those relationships.

There wasn’t a competitive process. We understood the business. We knew how we could create value. And because there wasn’t another buyer involved, we had more control over the transaction.

That’s one of the primary reasons buyers pursue off-market opportunities.

Jeremy Furtick:

Today’s outreach efforts are much more sophisticated than they used to be.

Years ago, these offers often came through generic direct mail. Today, buyers can use AI and data tools to create highly personalized outreach.

They’re reading your website.

They’re reading LinkedIn.

They’re looking at industry information and company updates.

The seller receives that message and thinks: “Wow, these people really know my business.”

What they don’t realize is they may be one of thousands of companies receiving similar outreach.

The personalization creates an emotional reaction. It feels validating. It feels like somebody recognizes the value of what you’ve built. That’s where sellers can get themselves into trouble.

Q: What Happens Emotionally When an Owner Receives an Offer?

Jeremy Furtick:

Many owners become emotionally invested almost immediately. It’s flattering.

You’ve spent years building something, and now somebody wants to buy it. It feels like validation for all the sacrifices you’ve made. The challenge is that sellers can become so focused on the buyer’s interest that they lose sight of the competitive disadvantage they’re creating for themselves.

The buyer seems interested.

The buyer seems knowledgeable.

The buyer seems like a good fit.

And before long, the seller is six or nine months into a transaction before realizing they may not be getting the best outcome.

Tom Bronson:

I used to get seven or eight calls a month from people saying:

“We’ve been following your company for years.”

My favorite response was:

“Great. What do you know about us?”

That usually stopped them in their tracks.

Most of the time, they knew very little beyond seeing us on a list or hearing about an award.

The reality is that most unsolicited outreach is not as personal as it appears.

Q: What’s the Biggest Mistake Sellers Make?

John Gorbutt:

The biggest mistake is oversharing too early.

Owners often feel like they know the buyer after a few conversations, so they start providing information before they’ve really thought through the process.

They discuss financials.

They discuss operations.

They discuss valuation.

And they do it before understanding how the buyer intends to use that information.

Another mistake is assuming the first offer is the best offer they’ll ever receive.

Someone may come along and offer what feels like a life-changing amount of money, and the seller immediately assumes that’s the best outcome available.

But if you’ve only got one buyer, you don’t really have a market.

And when owners get caught up in the excitement, they often fail to bring advisors into the conversation who can help them understand value and evaluate alternatives.

Q: Why Is Competitive Tension So Important?

Tom Bronson:

If you have one buyer, you have no buyers.

The first offer is never the full story. In fact, the first offer is usually the highest it’s ever going to be. Once a buyer enters due diligence, they’re not only verifying what you’ve told them. They’re looking for things they didn’t know when they made the offer. Every issue they uncover becomes a potential opportunity to revisit valuation.

If they find enough concerns, they may come back and say:

“We offered $30 million, but now we think it’s worth $18 million.”

That’s why preparation matters.

And that’s why it’s important to disclose the right information before signing a Letter of Intent.

Q: Are Unsolicited Offers Usually Fair Market Value?

Jeremy Furtick:

How can they be?

The buyer doesn’t know enough about the business yet.

A lot of buyers throw out a number that sounds attractive because they want to get the business off the table and into due diligence. Then they begin identifying risks.

The seller often believes:

“These people really like me. They understand my business.”

But buyers are not your friend. That doesn’t mean they’re bad people.

It simply means that buyers and sellers have different objectives.

The buyer wants to acquire the company for the lowest reasonable price.

The seller wants to maximize value.

That’s why experienced representation matters.

Q: What Are Buyers Really Evaluating?

John Gorbutt:

Most owners assume buyers are looking primarily at revenue and profit.

They’re not.

They’re looking at risk.

They’re evaluating:

• Owner dependency

• Customer concentration

• Recurring revenue

• Transferability

• Leadership depth

• Documented processes

• Operational consistency

They’re trying to determine whether they can continue operating the business successfully after the owner exits.

If the owner is deeply involved in everything, that creates risk.

If revenue depends on a handful of customers, that creates risk.

If institutional knowledge only exists inside employees’ heads, that creates risk.

Risk impacts value.

Q: Why Do Owners Often Overestimate Value?

Jeremy Furtick

Owners become comfortable with the risks inside their business.

They’ve been living with them for years.

Maybe they have customer concentration.

Maybe they have owner dependency.

Maybe they don’t have documented systems.

They’re comfortable with those things because they’ve been successful despite them.

Buyers don’t see it that way.

Buyers see risk. And risk reduces confidence. Market value is heavily influenced by buyer confidence.

Another challenge is sweat equity.

Owners remember the sacrifices, sleepless nights, and years of effort required to build the company.

Buyers don’t pay for effort.

They pay for future performance.

Q: Why Shouldn’t Owners Negotiate These Deals Alone?

Tom Bronson:

Business owners are unique people. There’s something about building a business that creates a sense of confidence.

You think:

“I’ve negotiated million-dollar deals for years. I can negotiate this.”

But selling your business is different.

You’ve probably negotiated hundreds of customer contracts. You may only negotiate the sale of your company once. You don’t know what you don’t know.

And because it’s your business, emotions enter the process.

That’s why I often say my role is 50% transaction advisor and 50% high school guidance counselor.

Sometimes you’re simply helping people navigate the emotions that come with selling the most valuable asset they’ve ever owned.

Jeremy Furtick:

I once heard somebody say:

“There’s a reason surgeons don’t perform their own appendectomies.”

Could they do it?

Probably.

Should they?

Probably not.

The same concept applies here.

Q: How Can Owners Prepare Before an Offer Arrives?

John Gorbutt

Preparation starts long before a transaction.

Owners should be working to:

• Reduce owner dependency

• Improve financial reporting

• Strengthen leadership teams

• Document processes

• Diversify customers

• Build recurring revenue

A valuation is also important.

Not just because it tells you what your business is worth.

A good valuation helps identify what can make the business more valuable.

Tom Bronson:

It typically takes three to five years to properly prepare a business for transition.

And remember:

“There’s always a market for a well-run business.”

If you’ve built a healthy, transferable company, there will be buyers.

Don’t let fear convince you that the first offer is your only opportunity.

Q: What Should an Owner Do When They Receive an Unsolicited Offer?

Jeremy Furtick:

Slow down.

Don’t send financial statements.

Don’t assume you’re ready to sell.

Talk to your advisors.

Talk to an M&A professional.

Understand your options before you begin sharing information.

An unsolicited offer doesn’t mean you have to sell.

It simply means somebody expressed interest.

Tom Bronson:

And if you already have an M&A advisor, your response should be simple:

“Great. I’ll share this with my advisor.”

If the buyer pushes back on that idea, that’s a red flag.

A legitimate buyer should expect professional representation.

Final Thoughts

Tom Bronson:

Every business owner should spend time thinking about what their ideal exit looks like.

Not because they’re ready to sell today.

But because every business will eventually transition.

The clearer you are about your goals, your timing, and your ideal outcome, the better prepared you’ll be when opportunities arise.

John Gorbutt:

Every business will either be sold or eventually close its doors.

You should be planning for that future long before you’re forced to make a decision.

Jeremy Furtick:

The biggest advantage of a structured process is confidence.

You make better decisions.

You avoid surprises.

And you dramatically increase the likelihood of achieving the outcome you actually want.

That’s why preparation matters.

Receiving an unsolicited offer can be exciting. It can also be one of the most important financial decisions you'll ever face as a business owner.

As Tom, Jeremy, and John discussed, the biggest mistakes often happen when owners move too quickly, share too much information too soon, or assume the first offer represents the best opportunity.

The most successful outcomes come from preparation. Understanding your company's value, reducing risk, building the right advisory team, and approaching opportunities strategically can dramatically impact both the process and the outcome.

An unsolicited offer may be the beginning of a conversation—but it shouldn't be the beginning of your exit planning.

If you're considering selling your business or have received an unsolicited offer, the best time to seek advice is before you make a decision, not after.

Ready to Understand Your Options?

Whether you've received an unsolicited offer or simply want to understand what your business is worth today, the team at NorthStar Mergers & Acquisitions can help you evaluate your opportunities and prepare for a successful transition.

Contact NorthStar Mergers & Acquisitions to start the conversation.

About NorthStar Mergers & Acquisitions

Based in Dallas, Texas, NorthStar Mergers & Acquisitions guides business owners through one of the most significant financial and emotional journeys of their lives—the sale of a company. Specializing in lower middle-market transactions across multiple industries, NorthStar combines deep valuation expertise, strategic marketing, and buyer engagement to ensure every client achieves their dream exit.

Visit NorthStar-Mergers.com to learn more about how NorthStar helps business owners navigate their ideal transition.