Today’s discussion will be based on a very important topic as it relates to selling an online business: confidentiality. Whether you own an eCommerce site, an Amazon business, an eBay store, a software application, or some combination of these, you have employees, suppliers and others that you most likely do not want to be made aware of the fact that you’re considering the idea of selling your Internet Company. Confidentiality is critical to selling a small business, and the best way to ensure confidentiality is maintained is to utilize the services of experts in the website broker industry. At WebsiteClosers.com, our brokers pride themselves in taking all steps necessary to ensure that every business we sell is kept strictly confidential so that the only parties made aware that the business is for sale is the Seller, the brokerage, potential Buyers that have executed a Confidentiality Agreement and lenders.
Employees. Often times, the most critical element to keeping the sale of a business secret is related to employee relations. What we have found is that if the employees even have a hint that the company they work for is up for sale, there can be trepidation and fear to their future once a new owner is in charge. This fear includes whether they will keep their employment, whether their job title or pay will change, and whether a severance package will be included if they are terminated. Clearly, when an entrepreneur is trying to exit their business, the one thing they cannot have is under-performing employees – which can lead to underperformance in sales. Each scenario is different, but our general recommendation to owners is to keep a potential sale secret from employees until the business transaction is final and funded. This is another critical need for an Internet Business Broker – a broker can help facilitate the sale and keep potential buyers away from the business (no emails, phone calls or communication with the business, its employees or its vendors should ever occur). Having an intermediary step in and remove the business from the transaction is critical. And if the particular business requires more of a hands-on approach to review during due diligence, the broker (not the seller) is in the best position to control the due diligence meetings to ensure confidentiality is maintained.
Suppliers. Another extremely important element to confidentiality in the sale of a digital business is the supplier base. Potential buyers should not be made aware of the suppliers of a business until it is clear that he is a real buyer with the capital necessary to buy the company and until a purchase agreement is executed. And even after a contract is executed and the due diligence stage begins, only that information which is absolutely necessary should be released – and only when appropriate. We have found all too often that many people inquire about businesses just so they can see who the suppliers are – or how the business is being run. A broker that has experience sniffing out these “bad buyers” is worth his weight in gold because a broker can separate the seller from the situation, play the bad cop during the negotiations and ensure that only good buyers are presented for the potential transaction.
There are of course many other components to confidentiality in the sale of an online company, so if you have any questions about our processes at WebsiteClosers.com, we invite you to call or email us at [email protected] or toll free at (800) 251-1559. We will do everything possible to ensure that when we represent your online company in the marketplace, confidentiality is maintained at the highest possible level.