Ensure you are leveraging the power of having the right pipeline
When the day comes that you might look to sell your business to a third party, a key question on the potential acquirer’s mind will be what growth opportunities does your business have looking ahead to the future? Certainly, they will look to be impressed by your historical performance but what will excite them is your forward-looking growth opportunities.
This week, LLR Partners (LLR Partners - Leading Private Equity Firm) released their report on the power of a sales pipeline for driving revenue and profitability and these of course underpin your overall company valuation. At Yosemite Associates, we couldn’t agree more with LLR Partners on this point as we regularly see acquirers spend a significant amount of time during due diligence doing a deep dive on the go forward growth opportunities of the business they are considering opening their check book for.
Ask yourself these questions:
- Does my business do a good job of tracking our sales opportunities both with existing customers as well as new ones?
- As part of this opportunity tracking, do we know key things like what our Win/Loss rate is and given this metric, how many opportunities does my team have to be actively managing at any given time to support the revenues we desire?
You can attract a potential acquirer to consider buying your business based on your solid historical results. But to excite them to place a premium valuation on your business, this will mean showing them the sales opportunity pipeline you still have available for driving further profitable growth. Start today ensuring you have the right sales opportunity pipeline tool under management with your team and use this as a powerful step in driving up the future valuation of your business.
