RealisingRealisingEntrepreneurialEntrepreneurialPotential/3Potential/3

INSEADINSEADAug – DecAug – Dec 2011 2011

Hitting the road: how to Hitting the road: how to organise a searchorganise a search

• need for achievement• vanity• independence• a touch of greed

Partners’ motivations

0% 10% 20% 30% 40% 50% 60%

Use my skills/abilityControl over my lifeBuild for the familyLike the challenge

Live where/how I likeGain respect/recognition

Earn lots of moneyFulfil others' expectationsBest alternative available

Entrepreneurs’ motivations

• 1 salary/ 1 search• 2 salaries – search part-

time• both no salary

Alternative routes

• criteria• roles• budget• calendar

Be organised

• be committed• be businesslike (you are in the driving seat)• look professional (looks better if you have a

company identity)• sound professional (do your homework)• establish credentials (your background,

MBA, team search, contact with angel and VC)

• remember, the bigger the deal, the more they will want to know about you front end, so don’t aim too high

How to appear serious

• industry sources• network• press• internet• chambers of commerce• specialised consultant• serendipity…

Deal sources/1

• VCs - only the dogs• lawyers/auditors - what fees?• brokers - no sale = no food (credibility issue)

Deal sources/2

• brokers’ deals likely shopped around• deals do not improve with age• remember that buying a business is like

buying a house, and then think what house ads are like

• resist early over-enthusiasm for a particular deal – there are loads of pebbles on the beach

• stay organised – keep a record of your search activity

Points to remember in searching for deals

• size and price OK• possible brand• tyre kicking – what is a “good” deal?• broker credibility – see, then reject, then

explain

Why cheese company?

Main points of session• two and not one• spending as little money as possible• networks• credibility• commitment• timing (18 months)• be organised• precaution (“what we chose to see”)• not a soft option