I sold Best Self Co in late 2022.
People ask me all the time what the process was like.
So how do you find a buyer? Well…
Why maybe that’s not the right question 🤔
Finding a buyer isn’t too helpful if you aren’t ready to sell.
Why?
Because you don’t sell the minute you sign the paperwork at closing, which by the way, is a very anticlimactic experience.
(Guess how it went instead? I’d built my company over seven years and put my blood, sweat and tears into it. I Docusigned. And it was done in less than 2 minutes. For comparison, I refinanced my house a year ago, and had to sign a sh*t load of papers for 20 minutes. A bit different experience for a fraction of the money.)
You have to be ready to sell in order to be acquired.
If our buyer would’ve approached us just 18 months earlier, they probably would’ve walked away from the conversation.
In fact my old business partner and I tried to sell a few years ago. But we weren’t able to. Honestly, I didn’t really want to sell the company. I only agreed to sell because I wanted to get out of the business partnership. (You can read more about that here 🙄)
All this to say…
You probably aren’t ready to be bought until you’re ready to sell.
These are the 5 things we did to prepare ourselves to be acquired 👇
5 things we had to do before getting ready to sell the business
Eliminating product & people risk
We had just a few really successful products – the journal among a couple others. Meaning we were dependent on those products.
The business version of having too many eggs in the same basket and a weak point from our buyers’ POV ¯\_(ツ)_/¯
So we needed to diversify.
Another issue they saw in Best Self was our people.
Essentially, no one was interested in buying the business if I weren’t highly involved. This ended up working out in my favor because I could buy out my business partner.
But I wanted to sell the business and step away. So we had to explore different options.
18 months before we eventually sold, I began delegating more and stepping out of my role over time. That way, when someone approached us to buy the company again, I would already be on my way out and they wouldn’t necessarily need my presence like they did before.
Moving 3PL 📦
(I talked about this in my 2021 year-end review.)
A few key decisions allowed us to sell the business. I think one of the most important was upgrading our 3PL (third party logistics firm FYI).
And this is a big deal. It means moving all your stuff to a new warehouse and entrusting a new company to package and ship your products. When it works out, it’s well worth it. And in this case, we’re lucky – it worked perfectly.
Here are some benefits we saw:
- Reduced customer support tickets by 60%
- Much smoother customer experience (fewer damages and claims)
- Reduced shipping costs and speed (cheaper for us, faster for customers)
It paid off big time. Win win for everyone involved. DM me on Twitter if you want me to share with you who we went with.
Moving production to Colombia from China
This was a big deal and took a lot of planning and brainstorming to get right.
We faced so many huge delays in our supply chain because of the pandemic and other causes. But we got lucky and found a new partner in Colombia that helped us …
- Faster production times (12 weeks ➡️ 4 weeks)
- Reduce inbound logistics & cost (8-12 weeks ➡️ 2-3 weeks)
- More environmentally-friendly products (e.g. sugarcane paper)
- Reduced tariffs (e.g. journals from China have a 25% tariff in the U.S.)
You don’t immediately see the benefits of this. But over time, an efficient production facility will really blow your mind.
Only problem? I wish we had made this change sooner.
Documenting all standard operating procedures
You don’t know exactly how much this helps you until you need to do it.
When we were thinking about how to sell the company, I knew that I wanted Best Self Co to outlast me. I wanted the very best for my employees and our awesome customers who’ve been so loyal to us.
So it was important to me that the right buyer would continue our “legacy” and treat our employees and customers as we had treated them.
Step #1 was documenting how we did that. Everything from how we marketed Best Self and how we fulfilled our orders to what exactly we included in each box. I didn’t want there to be any hiccups in how our customers interacted with the brand.
I know. It’s a bit nit-picky, but it was important to me.
Getting new leadership in place
Like I said, our buyers wanted me involved, but I was ready to step away from the business. And as I mentioned, I wanted to make sure employees and customers were in good hands long past my tenure.
We hired a marketing manager in 2019 who I ended up promoting to COO when I started to wind down my involvement.
I trusted her, so she took over the day-to-day operations when I sold the company.
Great decision.
Yeah, so again – Most people asking me how to find a buyer aren’t quite there yet.
You probably have a lot of risk that when a prospective buyer sees it, won’t touch your company with a 10 foot pole.
Take a look at these five areas. Then find your buyer:
- Eliminating risk
- Partnering with a great 3PL
- Finding a more efficient producer
- Documenting SOPs
- Finding new leadership
I’m still learning the benefits and consequences of all these decisions. But I got some great advice from friends who’d sold their companies before me. And I think most decisions were really well-thought through.
What do you think?