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At ICON we consistently achieve exceptional results: maximising exit value by getting the best deal the market has to offer

ICON's Role Indicative Timeline FAQs

ICON's Role:

10 Steps To Exit

If you’re thinking of selling a tech business, there are a few factors that should be considered before you go ahead. ICON will guide you through every aspect of the sales process, which consists of 10 main steps:

  1. Pre-Sale Planning

    In grooming the business for sale we will help you identify and resolve potential issues that may arise during the process: for example litigation and disputes, sale of peripheral assets, renewal of…

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    ICON's Role:

    Step 1

    Pre-Sale Planning

    In grooming the business for sale we will help you identify and resolve potential issues that may arise during the process: for example litigation and disputes, sale of peripheral assets, renewal of contracts that have lapsed, sale or closure of non-core business units, housekeeping and basic tax planning.

  2. The Sales Memorandum

    We will prepare the Sales Memorandum, which is the main marketing document setting out key information on the business.

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    ICON's Role:

    Step 2

    The Sales Memorandum

    We will prepare the Sales Memorandum, which is the main marketing document setting out key information on the business.

  3. Identification of Purchasers

    We will draw up a target list of potential acquirers. We will then filter this short-list to identify those buyers to whom the acquisition would be strategic (where there is a revenue or cost synergy…

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    ICON's Role:

    Step 3

    Identification of Purchasers

    We will draw up a target list of potential acquirers. We will then filter this short-list to identify those buyers to whom the acquisition would be strategic (where there is a revenue or cost synergy or a geographic gap – these buyers can justify paying a premium).

  4. The Approach

    We will make an initial approach to your potential acquirers on a confidential basis, this does not disclose the name of your company. Only once our Confidentiality Agreement has been signed, will…

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    ICON's Role:

    Step 4

    The Approach

    We will make an initial approach to your potential acquirers on a confidential basis, this does not disclose the name of your company. Only once our Confidentiality Agreement has been signed, will the name and the in-depth Sales Memorandum be distributed.

  5. Meetings with Acquirers

    We will arrange and attend meetings with potential acquirers and help you prepare.

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    ICON's Role:

    Step 5

    Meetings with Acquirers

    We will arrange and attend meetings with potential acquirers and help you prepare.

  6. Negotiations

    We will draw up a timetable to ensure that all the purchasers submit offers at the same time, which will allow you to compare offers and lets the buyers know that they are in a competitive process.…

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    ICON's Role:

    Step 6

    Negotiations

    We will draw up a timetable to ensure that all the purchasers submit offers at the same time, which will allow you to compare offers and lets the buyers know that they are in a competitive process. Setting this timetable requires experience, too tight and you may lose buyers, too long and you risk losing momentum.

  7. Indicative Offers

    In addition to price, we will ask the purchaser to provide details of funding, timetable, diligence and plans for the business. We will advise you on the intrinsic value of each offer and help you…

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    ICON's Role:

    Step 7

    Indicative Offers

    In addition to price, we will ask the purchaser to provide details of funding, timetable, diligence and plans for the business. We will advise you on the intrinsic value of each offer and help you select your preferred bidder – highest is not always best.

  8. Final Offers

    Before a preferred bidder is chosen, it’s time for us to clarify aspects of the offer and to negotiate keener terms. Buyers will often re-submit offers having “sharpened their pencil” and changes can…

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    ICON's Role:

    Step 8

    Final Offers

    Before a preferred bidder is chosen, it’s time for us to clarify aspects of the offer and to negotiate keener terms. Buyers will often re-submit offers having “sharpened their pencil” and changes can be significant if the acquirer believes this will secure the deal.

  9. Due Diligence

    This is a critical stage of the process and deals do fall down here, usually because of a change in business performance, or a breakdown of trust, due to lack of information. We will carefully…

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    ICON's Role:

    Step 9

    Due Diligence

    This is a critical stage of the process and deals do fall down here, usually because of a change in business performance, or a breakdown of trust, due to lack of information. We will carefully control this part of the process to protect the business and the deal. Chipping away at the deal terms is a popular pastime and under bidders need to be kept warm.

  10. Closing the Deal

    To successfully close the deal we need to actively project manage the process right through to completion, working alongside you, the acquirers and lawyers. Negotiation never stops until the ink is…

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    ICON's Role:

    Step 10

    Closing the Deal

    To successfully close the deal we need to actively project manage the process right through to completion, working alongside you, the acquirers and lawyers. Negotiation never stops until the ink is dry and the champagne is popped.

Client Comment:

I'm tremendously grateful to Monica and the team at ICON for the professionalism and utmost effort put into streamlining, curating and managing this process. We're all very pleased with the result and look forward to working with Monica again!
Luke Kyohere, Founder & CTO, Beyonic
Beyonic
I can thoroughly recommend Brian and his team at ICON. He ran a tight and competitive exit process for us, which ultimately led to high number of formal offers. That not only gave us terrific choice but also useful leverage in negotiations. Maximising our shareholder value was important, but getting the right cultural fit was also very important to us as owner/managers. Gamma ticked all the boxes. Brian was invaluable in driving up the value and managing the exit process but also had the experience and commitment to safely navigate us through what can be a daunting process
Scott Millar, Chief Executive, Exactive
Exactive
Thank you for your assistance with the sale of Hub Network Services. James has been exceptional over what has been quite a long haul. I cannot recommend your services, and James particularly, highly enough.
John Volanthen, CEO, HNS
HNS
All testimonials

Indicative Timeline:

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
Stage 1:
Preparation
Stage 2:
The Chase
Stage 3:
Delivery
  • Appoint Specialist Advisors
  • Prepare Key Information
  • Identification of Purchasers
  • The Approach
  • Meetings
  • Negotiations
  • Indicative Offers
  • Due Diligence
  • Final Offers
  • Tax
  • Legals
  • Completion
  • Managing the Business

FAQs:

What is my technology business worth?

  • The theoretical value of your tech business will be calculated as a multiple of underlying earnings (or revenue) adjusted for excess cash/debt. In practice though, it is worth what someone is prepared to pay for it. It will be worth different amounts to different acquirers, the key is identifying and engaging those that will be prepared to pay a premium – the strategic acquirers.

When is the best time to sell?

  • Timing your run is key. You clearly need to sell on the up, yet crucially you need to leave something on the table for the acquirer, so don’t be too greedy or you will miss the cycle. Tech M&A is a cyclical business and if you delay too long then you may need to wait for the next cycle. To maximise your value you need to time your exit so that market, sector and company conditions are favourable.

How do you achieve global reach at ICON?

  • As technology M&A specialists, we work out of our London and San Francisco offices. We have a database of technology acquirers worldwide and communicate with them regularly. We have recently sold businesses to acquirers in Canada, Columbia, the US and Europe.

How do you maintain confidentiality during the M&A process?

  • This is a key part of our role and one we take seriously. We never disclose confidential information on a client until a Confidentiality Agreement is signed. All communication is then through us and by only working with a small management team and keeping meetings off-site we minimise this risk.

Will I get paid in cash?

  • Yes cash will always be part of the consideration, but all the consideration may not necessarily be paid in cash at completion. Buyers may pay consideration in their own shares (which may need to be held for a period), loan notes or the payment may be deferred until after the completion date or be partly by way of an earn-out.

What is an earn-out?

  • An earn-out is a commonly used mechanism to narrow a valuation gap that may arise between buyer and seller, whereby the buyer will pay further consideration if the vendors achieve revenue or profit targets after completion. The time period for an earn out can be for a few months or a few years.

As an owner/manager, will I be expected to stay after the sale?

  • The key is to offer the buyer the commitment to stay if needed. This reduces the buyers risk and so increases your value. Most entrepreneurs stay for a handover period, but rarely more than a year or so. To allow for this, as an owner manager you should therefore be looking to exit ahead of your intended departure date.

Who pays ICON's fees?

  • Our fees fall in two parts, an initial fee that is paid by the company and then a success fee that is deducted from the shareholders consideration (along with other tax and legal fees) and paid by lawyers handling the sale on completion of the transaction.

What next? Download our free guide to selling your business:

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