Knowledge base item

What does a Corporate Finance boutique do?

Supporting your entrepreneurial journey

Entrepreneurs who are about to sell their company regularly ask what exactly a corporate finance boutique does and what its added value is. To describe the role of a corporate finance advisor, we often use the metaphor of the house agent. If all goes well, this broker knows how to properly assess the value of the property and how to market it for an achievable price. Furthermore, he takes care of the seller and is the oilman in the process.

In essence, selling a business is no different, just much more complex. This is caused by the necessary general knowledge (economic/juridical/tax), the necessary knowledge of the company (sector/organization/market/potential), the knowledge of the sales process (preparation/market approach/negotiations/closing) and thenecessary parties involved(notary/lawyers/accountants/specialists for bookkeeping research/tax consultants/external bodies such as SER/MNA/internal bodies such as the Works Council/Council of Commissioners). Theday of a Corporate Finance consultant therefore consists of constantly switching with multiple parties.

An average sales process takes 6-9 months, while a house is usually for sale in 3-4 months. However, the duration of the sales process of a company is largely determined by whether the company and the entrepreneur are prepared for the sale. When this is the case, an external sales process will run much faster. We therefore always recommend - based on more than 150 projects in the last 8 years - an extensivesales preparation.

What are the essential elements on which you should assess a corporate finance boutique?

What is her track record in general and what in particular with respect to the underlying business/sector?

Does he/she operate alone or with a team (office)? In other words: can continuity in the sales process be guaranteed? Can quality (4 or 6 eyes principle) be guaranteed on outgoing correspondence?

Is he/she a member of the relevant sector associations, in order to guarantee the external quality standard? Think for example of the trade association for business transfers (BOBB.nl), Netherlands Institute of Registered Valuators (NIRV.nl) or the knowledge association for Dutch merger and acquisition advisors (dcfa.nl).

Do financial arrangements run parallel with the interests of the company including its shareholders and management team? There are many ways in which merger and acquisition advisors can be remunerated, but in our view the only correct one is to ensure that interests are aligned with those of the client. And where conflicting interests arise, these are identified and addressed at an early stage.

How is the ideal team put together?

Every situation is different, so too is the composition of the ideal team. Which advisors and management does the company already have? Do they have experience with acquisitions? Will key management be involved or not? Is there a supervisory board and/or works council? Is there already a buyer and is there a need for more parties or is there a preference for a bilateral process? Does the company's legal advisor have a lot of experience with mergers or acquisitions or is there a need for a specialist? Are there specialist issues that require additional advice/analysis (ICT/pension/HR/commercial)? All these questions have an impact on the design of the project team that will guide the sale to the maximum result.

On the consultant's side, depending on the size of the transaction object, teams of 2-5 people are used in SMEs. In this team, the different steps of a sales process are ensured. This includes the strategic and financial analysis,company valuation, drafting confidentiality agreements, the information memorandum,process letter, process coordination, negotiations, coordination of the transaction documentation and the Closing.

Why go with a corporate finance boutique?

Selling the company is often an intensive process. It is one of the most important emotional events in an entrepreneur's life. Often the passion built up over many years can only be cashed in once, so it must be done 100% right. There is no or very limited opportunity to correct mistakes. As an entrepreneur you want to know exactly what you're getting into and you don't want to take it lightly. It is therefore very wise to have an experienced team standing beside you. It is always an intensive period of cooperation where the parties have to complement each other very well.

A good example is a company where two shareholders are involved. One of the entrepreneurs wants to sell and the other one would still like to continue. There are then different interests in advance which have an impact on the intended sales structure. Unique situations will arise in the normal course of business. For example: how to deal with the CEO (who is not a shareholder) who needs to remain motivated for the sales process, but will be serving another gentleman (namely the Buyer) in the future?

It is these issues that make our work so interesting. A corporate finance boutique is particularly driven to solve emotional pieces of the puzzle and to bring the whole thing to a successful conclusion with the aim of achieving a sustainable transaction. At Florijnz we stand for the passion of the entrepreneur.

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Hans MinnaarFounder and director
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