Mark Osborne explains how buyers use unsolicited offers to trap sellers. They dangle a headline number, lock you into exclusivity, then dig into your financials and renegotiate down. Sellers without strong advisors often fall for it.
A lot to discuss here. So I'd say, first of all, private equity and all kinds of buyers are getting very, very good at getting directly to a seller and coming in with the unsolicited offer. So that's a huge trend we're seeing over the last few years. So then the seller gets this offer and it's this great number and they get excited and they're not sophisticated and they don't maybe have great advisors around them. So they're very suspect to this game plan that these buyers— these buyers' goal is to basically give you an offer and to get you under exclusivity so they can, again, learn as much as they can about the company, look for reasons to get that number down, and basically change the deal on you. That is a very common buyer tactic. We see it all the time. And a lot of times sellers are just not educated on how deals operate and they get lured in by this headline number. But if you look below the covers, And they get this $20 million offer.
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