Here is a guest post from Bruce Clark, CEO & founder of one of our trusted vendor firms, New Clients Inc. He talks about why NCI is the best bet for a firm getting ready to sell, as against a general business broker with no specific understanding of the accounting business.
I recently had an experience with a general business broker that I will describe as interesting, illuminating, and disappointing. In the end, it turned out to be a cautionary tale for practice owners like you who may be looking for a broker. However, it also showed why NCI remains a leader in the practice sales arena!
The story begins when I received an advertisement listing a large accounting practice for sale in my state; it boasted $2.9mm in sales and attractive net profits. This, along with an offer to co-broker, led me to reach out. I left a message introducing myself, noted that I had financially qualified buyers, and received no response for three days. I called again and reached the broker, who told me he had been sick. Fair enough. People get sick. He assured me one of his assistants would send me the NDA to sign. Another three days passed and I received nothing. I called on day four. He seemed surprised that I had not received the NDA, and finally sent it via DocuSign. I signed it and returned it the same day. Again, I heard nothing, so I contacted the broker once more. He claimed he had not received it. Frustrated, I offered to take a photo of the document and send it, which he agreed to. At long last (after two weeks), we finally seemed to be on our way.
I next asked him to send me the prospects he had already spoken with so I could eliminate them from my efforts by cross-referencing them with my database. At this point, he revealed that he had 100 signed NDAs. Really? 100 signed NDA’s for a practice listing at $10mm? This didn’t align with my experience, so I asked if he secured financial statements from these prospects. I received a somewhat indignant reaction. I added that NCI routinely requests financial statements with NDAs to prequalify our prospects. This assures our sellers that the buyers we present have the financial resources to complete a sale. He stated that his firm does not do this, so he essentially lined up buyers for a $10mm purchase with no knowledge of whether these buyers had the funding for the sale. Think about this. You cannot buy a $10,000 car without being prequalified, and this broker had no prequalification process for a $10mm practice sale!
Everything up to this point gave me serious reservations, but when I asked about how commissions would be split, the response confirmed that I needed to part ways with this broker. Keep in mind that this was one of the largest business brokers in my state! In fairness, I know all general business brokers do not operate like this; however, I also know this: most general business brokers do not understand the accounting practice sales market the way NCI does. Our strength lies in helping accountants and selling accounting practices. It’s all we do now and it’s all we have done for 35 years. Proof of this can be found in each of the 4,000+ firms we have helped build.
If you’re ready to sell or getting ready to sell, let’s talk. With NCI and me, you will be in the hands of an industry-focused professional—not in the hands of a general broker who doesn’t understand your profession or your business. This is why I only sell accounting practices; I don’t venture outside of my expertise. I just wish general business brokers would look at the accounting sales market the same way.
Call me at 856-304-1035 or email firstname.lastname@example.org
Powering your future,
Bruce J. Clark, CEO