When you hire an M&A firm, you're making a major decision that can generate extensive value for your company. Hiring the right advisory team is key, since no two advisors are exactly alike. As you interview different firms, consider asking these questions:
- Is this an ideal transaction size for your firm? You want to ensure the firm has ample experience with transactions of a similar size to your own. If they only specialize in very large or small transactions, and yours is neither, all of the experience in the world won’t matter, since it may not be relevant to your deal. Moreover, if the firm is not accustomed to transactions like yours, they move you to the bottom of their priority list.
- Who will oversee my transaction? Most firms bring out the big guns for an interview, but then leave you with junior associates for everything else—especially if your transaction is smaller than what they usually handle. Ask what you can expect in terms of recurring support, and make sure the daily point person is both qualified and personal.
- Which buyers will you target? Your advisory team should be able to tell you about their marketing plan, whom they will target, and how. A competitive bidding process can fetch a higher price, so they should be able to identify 5 to 10 potential buyers, as well as a clear plan for targeting them.
- How will we communicate? You need regular updates on the process—not weeks of silence. Your advisory team should free you up to run the business, but should not remove you from the communication loop. Importantly, they must give you regular updates so you know that the deal is proceeding as intended.
- How much will this cost? Good firms are transparent about their pricing structure, and do not try to rope you into a deal with lots of hidden fees. In most cases, you can expect to pay more for more services and for a more respected firm, so consider not only the final price tag, but the specific value you’re getting for that fee.