Why confidentiality book ends the Exit By Design process
Why confidentiality is so important in the confidentiality process
Only in rare cases are businesses willing to share the fact that they are considering or have decided to exit their businesses. In every other case, they want to keep any conversations or activities associated with the preparation of an exit completely confidential. Sometimes this extends to family members, staff, stakeholders, professional service providers, clients, and customers. This confidentiality process protects you and your business from reactions and decisions that can negatively impact your business and the outcome of any exit strategy.
Perception is reality
It is true that 'sunlight is the best disinfection'. That applies equally to your people as to your suppliers, customers, clients and even family members. Transparency is essential in managing reputations and empowering your people to work effectively as teams. Unfortunately, the same rarely applies to an exit strategy. For many, the seismic change of an exit plan is seen as an existential threat, inducing the 'fight or flight response. 'Yes', you need to communicate your goals to exit, but it needs to be done on your terms when you're prepared, and the deal is locked down.
When is confidentiality less of an issue?
Family successions and Management buyouts may require less confidentiality. Individual owners may place less emphasis on privacy based on the nature or culture of a business. How confidentiality is applied or not applied is ultimately the choice of the individual business owner. Even in a case with succession or other transitional models, the Exit By Design team operates under the same level of confidentially, allowing the owner to share (or not share) information we provide at their discretion.
What is the upside of maintaining confidentiality?
With exit plans, confidentiality is your trump card. It helps you focus on improving your business in the short term, driving higher valuations at the exit and beyond. It provides the peace of mind you need to focus on achieving clearly defined outcomes in a short period. It gives you the confidence to control the negotiation process and lowers the risk of commercially confidential information leaks.
Why do you need 'whole of business' confidentiality when contemplating an exit
Most exit processes focus on the commercial and legal aspects of a business; however, to navigate your way to the best commercial and legacy outcomes of an exit, you need to adopt a 'whole of business’ approach. It would be best if you ran a parallel confidential strategy across every aspect of your business to ensure minimal risk and interruption to your business today and exit valuation tomorrow.
An example of 'whole of business' confidentiality
Brand and Marketing is an essential element of any high-value exit outcome. If managed correctly, it allows you to increase your short- and medium-term revenue and EBITA, which drives higher valuations. It can also improve reputation, demonstrate the scalability of your business, open new markets and opportunities and (most importantly) put you on the radar as a potential acquisition for larger companies. The Exit By Design process allows you what, to most viewers, seems to be a standard brand and marketing revitalisation strategy. However, we run such a strategy with multiple targets in mind. Firstly, we focus on short- and medium-term revenue and profit improvements, maximising returns from existing customers while attracting and converting new leads. We then implement a parallels strategy that focuses on raising your business profiles in ways that increase visibility to businesses in your space or those wanting to break into your sector. This process requires two types of the report; the first follows familiar marketing models. The second focuses on visibility designed to attract more businesses that may wish to acquire your business. Confidentiality applies to the second reporting.
Confidentially working with Exit By Design
The Exit By Design process allows you to efficiently and securely manage the exit strategy and implementation program. Our entire team operates under strict and documented confidentiality terms. After our initial meeting, we will determine a plan and timeline in keeping with your exit goals. 'Whole of business' resources are available and applied when and where they can produce the most effective and timely outcomes. Reporting and communication are conducted using confidential protocols and using secure technology. Information becomes publicly available only when a deal is signed, and you are ready to make an announcement. Even then, we help implement a program to manage this process to deliver the best possible outcomes.