The sale of a website is a unique proposition and each transaction must be carefully planned and executed to ensure a successful outcome. There are a number of stages involved in the sale of a website and at FE International we guide the seller from the initial planning and preparation phase through to the signing of the purchase agreement and beyond. Intensive support is guaranteed throughout the entire sale process.
1. Assessment / Knowledge Transfer
At the outset of this initial phase, we will seek to learn more from you about the business, its performance and your expectations. We typically conduct a review and preliminary assessment of:
- Traffic data;
- Financial performance;
- Operating activities; and
- Sale rationale
We will ask you for financial information relating to the business as well as website traffic data to assess its overall performance. Once we have analysed the information, we will provide you with a valuation taking into account all the factors specific to your situation. We will discuss with you in greater detail the transaction process and explain how we will market your business for a successful sale.
Grounded in years of experience, FE International’s valuation process is unique, empirically driven and bespoke to each transaction we take on.
In formulating a view on the right valuation for your business, we take in to account a large number of factors from financial performance through to operational setup and details specific to your situation. We carefully evaluate all the business’ fundamentals independently whilst factoring for market trends relevant to the niche.
We pride ourselves on our ability to accurately value online businesses. We leverage our significant transaction volume (70+ deals in 2013) to empirically ground our valuations across all niches and business models.
3. Sale Preparation
Following initial review and valuation, we will gather further information from you regarding the operational details of your business. From here we prepare a clear, concise and unique marketing prospectus that positively presents your business’ history and persuasively demonstrates its prospects. This document presents the facts about your business in a way that is meaningful to buyers, most of whom review online investment opportunities on a regular basis.
When creating the documentation that will eventually be used to make a first impression with prospective buyers, FE International leverage the best practices and standards learned from several years’ experience in on-and-offline M&A. Our marketing materials are industry-leading and known for being extremely thorough and highly effective.
4. Marketing & Negotiation
During this phase we leverage our extensive buyer network to compile a comprehensive list of relevant prospective buyers to market to. We have a unique go-to-market strategy tailored to each transaction that maximizes outreach and successful execution. We vet all buyers and only work with experienced and professional investors to guarantee an efficient process.
Confidentiality is of paramount importance to us and to our clients. The dissemination of your business-sale information is handled with the strictest care using non-disclosure agreements where appropriate. We are never a dual agent, in that we do not represent the buyer and seller at the same time.
Once a serious bidder(s) is/are identified, the price, terms and other details of a transaction are agreed. A Letter of Intent (LOI) is the formal document used to set forth the major transaction terms, confirmed in writing in order to prevent misunderstandings. The LOI is constructed to protect you (the seller) from buyer delays which can cause you to miss the window of opportunity for your sale.
Upon receipt of the LOIs, we conduct a review of all factors, analyzing the viability of each LOI based on our client’s goals. We also diligence various aspects of each bidder in order to factor in the more qualitative aspects of the offer (in addition to the quantitative aspects). Using our extensive broking experience, we negotiate with bidders to achieve the best possible offer for our client. We ultimately select one bidder, usually committing to somewhere between 5-20 days of exclusive due diligence depending on the complexity of the business.
5. Due Diligence
A buyer will naturally want documented, defensible evidence of your business’ financial history and will also have a number of questions regarding its operating activities. Our team at FE International proactively manages the due diligence process so that you can focus the majority of your attention on running the business while the buyer conducts both the discovery and confirmatory diligence items necessary to close. We proactively anticipate the questions asked by the buyer and brief our clients beforehand to ensure seller preparedness and to maintain deal momentum.
This process operates through a unique data room tailored to the business in question and its various attributes. The use of a data room offers unparalleled security and it allows FE International to control every document and track every movement of a buyer to form a clear audit trail.
Once due diligence is completed, we progress to the final step of the sale process. In concert with our client, we help negotiate and structure the terms of the Asset Purchase Agreement with the buyer and their legal counsel. Distilling all prior discussions and documentation down into a single agreement requires a thoroughness and attention to detail that FE International specialize in. We will carefully construct an agreement that protects our client and contains all the terms to satisfy both parties. This is made available for review by all legal counsels.
Once the Asset Purchase Agreement is signed, we employ Escrow to facilitate the transfer of funds to the seller and business assets to the buyer. We oversee this process and use Escrow as an independent, trusted third-party to ensure successful, safe and protected transfer of ownership.
Again, this is conducted through a secure data room solution.
7. Post Sale
At FE International we know that for buyers, purchasing a business is just the start of a bigger journey. To ensure the smooth transfer of ownership and the successful operation of the business over this transitional period, we always ensure sellers commit to provide a pre-agreed level of support and training to the new owner. We endeavour to make sure the seller is well prepared for the task of knowledge transfer and encourage them early on in the process to prepare instructional materials and process manuals for the buyer.
How We Support Our Clients
- Financial review of the business and business valuation
- Formulation of the deal marketing strategy
- Preparation of the marketing materials
- Identification of potential buyers worldwide
- Approach of pre-screened and vetted investors
- Management and control of the entire sales process from offer to conclusion
- Negotiation of purchase price and contractual terms
- Preparation and monitoring of due diligence
- Contract drafting and execution
- Oversight of secure transfer process through Escrow