But what about if you’re a founder and you have a platform business. A private equity fund looks to engage with you, how would you advise working with them on a buy and build strategy?

Before they’ve invested in you?

Yes, and during.

I talk about kissing a lot of frogs in acquisitions. Actually, you need to kiss a lot of frogs in private equity, as well. When we were looking for a private equity company to do a deal, it took us a year to find a private equity company that we both liked and that would pay. We met, probably, eight or nine private equity companies, before we made a decision. We had an advisor to help us. We put together a presentation about Access and we would go to the private equity company and we would make that presentation; this is why you should invest in us. Almost all of them were interested. Probably 90% of them said they would like to invest, but only one of them was willing to pay the money, really. There are an awful lot who regret they didn’t.

They’re very easy to engage with but, as a founder, if you’re going to go to private equity, you do need an advisor. You’re not going to go on your own and go it cold. You might go it cold, initially, just to have a little chat to people but really, you want to engage an advisor. There are lots of them out there and, actually, I think choosing the advisor is the more important thing. If a target says to me, I think I’m going to approach the advisor, I usually say, well, obviously that’s up to you. We’re interested in buying the business, but if you want to appoint an advisor, at least let me give you some ideas on how to do it. An awful lot of people seem to appoint advisors they met down the pub, or a mate, who sold his business. It’s just not the way to do it.

You need to prepare a presentation of your business, in the best possible frame that you can. Choose three or four advisors and send them the presentation. Invite them to come to a meeting and present the presentation to them. The key questions you are going to ask them are, what do you think you might get for my business? What do you value my business at? How often do you achieve that valuation, when you sell a business on my behalf? How often will you actually get that number? How much are you going to charge me, for actually doing this? Some of them charge lots of money upfront. Some of them do in on a percentage at the end. There will be a mixture of both. Then you can make a choice. There are some very, very poor advisors. I’ve talked to people who have appointed an advisor and I’ll say, how many meetings have you had? They’ll say, none; I haven’t done any. They’ve just taken eight grand off them, to write a report. You need to do the same with the private equity companies.

Make sure you have all your facts. Make sure you get the business in the best possible light, as you can. Look at your own KPIs, like churn, length of service of employees, your EBITDA, whether you have increasing sales or not. There’s no point in presenting it in anything other than its best possible light.