One of our clients just finished evaluating an auction opportunity.
Our proactive process makes auctions more efficient because we pre-define what our clients seek. So, when offering memos are received, a quick benchmarking of critical data versus criteria can lead to a very efficient YES/NO Pursue/Pass decision. You don’t need to even read the whole memo until you have someone summarize the 5-7 critical characteristics for you and it is deemed a PURSUE because it fits.
Back to our client noted above – they had the deal opportunity in hand when Capstone came into the picture because a banker showed them the for-sale opportunity and they said “Sure, I don’t have much to lose if I sign the Confidentiality Agreement.”
Of course, working exclusively in an auction environment means you are also held to someone else’s timeframes. It is therefore critical to have a very efficient decision-making process if you decide the “stay in the game.”
One of the challenges that we worked through with the owners and leaders of our client was what does a good investment opportunity actually look like for them? How do you describe it? What would you walk away from if it was identified? These “tools” were not pre-defined but by the end of the process we jointly had a much better picture – for next time.
Moral of the story: If you have a clear strategy and your ideals outlined, you won’t waste resources looking at for sale deals that don’t make sense and you will be better prepared for making solid decisions throughout the process.