They say great companies are bought, not sold.

But let's be honest - there aren’t that many great companies around.

The great ones catch lightning in a bottle with a great team, great product, great market and near-perfect timing.

These companies grow to become billion-dollar enterprises, and drive change on a global scale. They’re rare.

Then there are the millions of companies sold each year. They’re not great in that traditional way.

I know. I’ve personally sold four of these companies.

Two were little ones– small, cash flowing businesses that were never going to be anything big. One we had to sell because it didn't have good product market fit, and needed a different long-term owner. Then there’s the life changing one - the one that helped me and my family get financial freedom.

Each of these companies was doing between $100k and $5m of revenue at the time of sale.

So if your business is in that range - this is for you. And even if it’s not, there are still some nuggets of wisdom in here that you can apply to any competitive process like a job search, finding a date, or executing a regular business deal.

Selling a business is not something you get reps and sets at.

It’s a delicate subject, more like managing a relationship then leg day at the gym.

People have asked me about it before - and here are the six lessons I share from my experience of selling those companies.

First off, here’s what I mean by sold. A company is 'bought' when another business strategically requires it, prompting an external pursuit.

It's 'sold' when internal stakeholders decide to sell, because the board or team wants to move on, or the business doesn't work out.

And that's totally okay, it's the way business works. Because if you can't lose, then you can't win.

The first thing people often get wrong when selling themselves or their business is thinking it needs to be perfect.

Nothing is perfect. There are always problems with anything.

For a company, it might not be growing fast enough, maybe the margins are too thin, the competitors are too strong, or the product’s just not good enough yet.

That stuff is good to know but not a decision factor of if you should sell. If someone claims that a business has no problems, be suspicious.

What you do need to show is that the company has a huge amount of value that is unlocked in the hands of the buyer - whoever they are.

Lesson 1 - The Message

Your company may have many buyers, offering multiple prices, depending on what the potential buyer sees in that company and the value it can bring them.

Thinking of your company as a 'Magic Box' can help influence a buyer’s perspective.

It helps them to look beyond the company’s outside and look deeper, to the magic of what could be. Where an astute buyer can appreciate the opportunity to unlock the company’s full potential.

Maybe it’s just about bringing more capital, better management, distribution - whatever. You want people to see the dream and growth potential.

The way you present this box is going to be different for the potential buyers you’re speaking to.

Some of those buyers are going to want different things in that box. May they are looking at the customers, others might want to focus on the technology, another might be looking at how to utilise the team.

And you want to do the work for them.

You probably have a company overview or pitch deck, but you’re not going to take this one out to the audience of potential buyers.

No, no, no.

You want to take that one company overview, and create the pitch deck that makes sense for each of those 50 buyers and show them how your magic box is the missing piece of their company’s puzzle.

Think about it like a Cover Letter for a new job. You don't make one Cover Letter with generic stuff and then give it to 50 potential employers.

You do the work and create a highly targeted Cover Letter that really speaks to the one person or company you want to work with.

Same thing goes for selling a company. Once you have the message right, and you have buyers circling the business - then next step is to determine the strategy.

Lesson 2 - The Strategy

One of my friends did an MBA in 2014, and I asked him what was the most important thing he learned.

“BATNA is everything.” I had no idea what he was talking about at the time but now I see why he said it.

If you haven’t heard of BATNA, it stands for Best Alternative to Negotiated Agreement.

BATNA is your plan B.

It’s what you’ll do if the current deal doesn’t go through. It's your safety net during negotiations.

It keeps your options open. Stops you from being desperate.

Because different companies are going to offer you different prices based on what they believe is in that magic box.

When we started negotiations on one of my companies - the bid-ask spread was massive. The first price was so far away from the price that we wanted. A shockingly low ball. And I was like, “oh man we're never going to get a deal done.

That’s when one of our board members told me to relax.

He’d been working in corporate development for years and was like, “Andy - this is fine. We should expect a massive spread when things are just getting started.”

This was one of the first buyers to put in an offer, so we were in this in-between zone.

If you only have one buyer, you have no competition, so not much BATNA.

This was as the very start of the selling process too, so we had to slow this buyer down to keep competitive tension alive and make time for other companies to submit their offers,

I learned that what we were really looking for was ZOPA.

Which stands for the Zone of Possible Agreement.

It’s that sweet spot between the least you’re willing to sell for and the most your buyer is willing to pay.

While you’re working out where that overlap is, it can feel like the deal is balancing on a knife-edge, always about to tip over.

But holding your nerve is crucial because what you’re really doing is keeping the momentum going in the right direction to find a spot in the ZOPA.

Imagine it like getting into a relationship – as long as the temperature is steadily rising, you're heading towards something good. But if things start to cool down between you, that's a warning sign.

This approach can be the difference between a deal that falters and one that crosses the finish line.

Ideally you’re not just doing this dance with one party but with many. Because that drives your BANTA up. Having alternatives is empowering - like a relationship where lots of people are interested in dating you.

The fact that others are interested makes you even more attractive and gives you options if one person doesn’t work out.

The key difference here is that, in business, you need to protect the relationship while also being super commercial and talking about numbers.

You also want to continually inspire hope with each party because you need them in the race.

In relationship terms, selling a company is a bit more like a game of Survivor. It’s about being strategic every step of the way.

Each time I've sold a company, I've known ahead of time which buyer the deal makes the most sense for. And I’ve found it most helpful to make sure they know that I want to make the deal happen, but that we have other options and that we need to be fair to our shareholders.

This brings us to a really important lesson on pricing.

Lesson 3 - The Price

A good enough price with the right buyer is way more valuable than the best price with a poor buyer.

It pays to look deeper than the price tag.

Maybe that buyer with the sweet offer is going to have trouble closing the deal because of some risk you’ve identified or a string they’ve attached - anything that could make the terms of the agreement less good for you.

There’s more to a deal than the money.

You need to balance price with terms and certainty. That’s a good deal.

In one of the companies I sold, a potential buyer submitted a much bigger offer than what we had from other interested parties. The problem was, it included a huge amount of stock.

And we had no conviction about the future value of that stock.

Even if we could tell a good story on a headline - the highest price wasn't the best deal.

It’s really important to think about that. If you truly care about your shareholders and the business's future, accept the right price with the right buyer on the right terms.

What goes around comes around.

It’s like choosing the perfect partner, you want to aim for the best overall match based on a number of factors you care about. Not just the best looking one, the funniest or whatever.

The terms of your relationship will determine the experience of your engagement.

Now you’ve worked through the steps of getting the right message, the right strategy and the right price, so you’re ready to move forward with the sale.

This leads to signing a Letter of Intent, which normally includes an exclusivity agreement. This means you can no longer flirt with other buyers. You’re engaged now.

This process is where I’ve made the biggest mistakes and learned the biggest lessons.

Lesson 4 - The Process

As soon as a letter of intent is signed, it's like you and the buyer are on one team, while the lawyers and everybody else are on the other.

Because the thing is, your lawyers are incentivized to drag out the M&A process as long as possible. That's because they get paid for the work (hourly).

Your people will want to know what's going on. You can’t blame them. Their income and future is in your hands and they deserve to be taken care of.

The situation can be intense.

It's hard enough for you to keep your own emotions in check.

You don't want to be managing everyone else's as well.

The merger and acquisitions process can be distracting and it can often become all that I can focus on. That led to me making a mistake.

It happened when I told the first company leader about the acquisition - something I thought was exciting news.

She was like - “yeah yeah yeah, but what's happening to my stock options.”

I’d misread the situation. I thought she should be most excited about the company, future prospects, the big picture.

I didn't realise people would jump straight to “what's in it for me”.

I should've known this as it's actually a key principle in one of my favourite books - How to Win Friends and Influence People.

The principle is this - talk in terms of the other person's interests. Of course they care about the company - but the bigger question you always need to answer first or quickly is what a change means for them personally.

My oversight was part of the mistake of letting the company’s Inner Circle know about the deal too early.

I learned to give people information when I’m in a position to give them the answers they’re looking for. Since learning that lesson I'm really clear with my people - You get one update a week, guaranteed.

In exchange, they agree to stop asking me every day if the company is still getting sold.

I learned it’s much better to insulate a team from the process. Not just for the CEO, but for them too.

It can be stressful for them to work with too much ambiguity and I owe it to them to wait until I have the information I know matters to them most.

It’s not heroic to give people empty promises. When I speak to people going through the process now - I suggest they keep the prospect and process of any potential deal on a need to know basis, ideally it's just the CEO and and CFO.

But, eventually, there's a time where you actually need to loop in the broader team and that's when you need to be prepared to answer all of their questions.

That brings me to...

Lesson 5 - The Structure

A few years ago, there was a home we wanted to buy. It had a really nice outdoor furniture set up that the seller planned to take with them.

It was a perfect fit for the space, and it would take us months to find something similar and assemble it - and we wanted to buy the house with that table.

We got the building inspection report back and it noted a few things that needed fixing. So we proposed to the seller that we cover the remediation costs if they left us the furniture.

This is the same approach when selling most things in life, even a company…

You eventually realise that everything is negotiable.

In the case of selling a company, price is just one piece of the puzzle.

If you’re the person selling the company, you’re going to be the best informed, the one who’s most invested in the people, the customers and your company's future.

To sell a company, I’ve found that a simple and efficient approach is best.

But there's one area where complexity makes sense. And that's when you’re advocating for your team.

People are the most important thing.

They have invested themselves in your business. They've made promises, have expectations, and want to see a good future for themselves and their families.

How much people get paid in cash vs shares, vesting acceleration, new equity grants - it's all back on the table.

You are the only person representing them at the negotiating table. And you can design great paths and outcomes for them. I’ve found what really goes a long way is making it a good ending.

Lesson 6 - The End

Even though you’ve probably been planning the end for a while until the day you get money in the bank, it's super important to operate the business as if the deal won’t happen.

So many things can go wrong. Time kills all deals.

When you're getting close to the finish line, I really encourage you to think about how you can make it a magic moment. There are only a handful of these moments in a company's journey.

Things like: founding the business, getting the first customer, the first million dollars in revenue and the first acquisition.

They’re milestones and its important to celebrate the wins.

Most people will only work for a handful of companies over the course of their life. It’s right to honour their investment in supporting the milestone.

Something that worked well for the largest company we sold was that we got everyone custom-made shoes with our company values on them.

The gift helped staff appreciate they were part of a team, working towards creating something that didn’t exist before they helped bring it into being, something bigger than they could do by themselves.

I still look at those shoes and remember that magic moment.

Parting advice

This is what I’ve learned on messaging, strategy, pricing, process and structure.

But if I had to leave you with one thing it would be this.

Make sure you talk to people who have done it before to understand how it works.

Stuff like what they did, what would they do differently, deal structures, timelines.

Even after a successful acquisition, things can get really complicated. For some people, it can be like winning the lottery, and bringing life-changing money into their lives.

For me, it was a day when everything changed. Before that day, so much of my time was occupied with worrying about money.

Now we had some money. It wasn't about leaving my job or telling my boss to go shove that next project.

It's the freedom to do what you want - to put your family first, own your story, volunteer for causes you believe in - whatever.

If you've ever thought about that day – and especially if you haven’t – you can check it out here.