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October 03, 2023

How to Have a Successful First Meeting in M&A

If you're interested in buying or merging with another business, you know you'll have your work cut out for you. Depending on the size and complexity of the business, this is a deal that could take months, or even years to finalize, and missteps in the early phases of the process could set you up for premature failure.

After finding a prospective target, your journey is going to start with a simple meeting. During this meeting, you'll get to know the seller, ask thoughtful questions, and hopefully set the stage for a successful negotiation down the line.

So what can you do to make sure your first meeting is successful?

The First Meeting

In mergers and acquisitions, the first meeting is your opportunity to make a genuinely powerful first impression. Sure, you may have already met this point of contact, or they may already be aware of your business, but this is the first time you'll be meeting in a formal capacity.

Obviously, a couple of simple mistakes in this introductory meeting probably aren't going to have the power to derail the entire deal, especially if you make an attractive offer or if the seller is desperate to close the sale. But if you want to maximize the value of this relationship, improve your negotiating leverage later, and simultaneously facilitate better communication, it's important to invest in the first meeting.

Technology and Setup

If you're meeting in person, you won't have to worry too much about communications technology. You can engage with your prospect in a much more natural, intuitive way. But if you're unable to meet in person, or if it's more convenient for both of you to meet digitally, you'll want to spend some time perfecting your communications technology setup.

·       Propose a known platform/medium. When proposing the meeting, suggest a communication platform that you are already familiar with. While most modern communications technologies are designed to be intuitive, you'll be much less likely to make an embarrassing error in your “home base” platform.

·       Review and mitigate potential hiccups. If you use this communication medium regularly, you may already be aware of potential hiccups that could affect it. For example, are there buffering issues when streaming video? Are there call quality issues that you might be able to address before this meeting? Do you have a backup internet connection if your primary connection goes down unexpectedly? Proactively address these potential problems.

·       Provide detailed instructions. If you're asking your prospect to join a conference call or video call, provide them with detailed instructions for how to join. If your prospect is confused, or if you communicate these instructions poorly, it could set a bad tone for the meeting.

·       Conduct a round of testing. With all the meeting plans in place, consider conducting a round of testing. Do a kind of dress rehearsal with someone on the other end testing the communication set up to ensure that everything is working as intended.

·       Submit a loose agenda. It's also a good idea to send a loose meeting agenda to the people who will be attending. How long do you expect this meeting to last? What topics do you want to cover? In what order are you going to cover them? What should people bring to the meeting?

Additional Keys to Success

These additional keys to success can make sure your meeting goes as smoothly as possible.

·       Understand your audience. Before jumping into a meeting, it's important to spend some time trying to understand your audience. What is this business like? Who's in charge? How do they usually make decisions? What are their perspectives and values? Acquiring and reading the Confidential Information Memorandum (CIM) can introduce you to these topics and more, helping you understand the people you're about to speak with.

·       Do your due diligence. You're not going to make any final decisions in an introductory meeting, but it's still important to demonstrate knowledge and confidence when talking to other professionals. That means you should spend time on due diligence, researching similar companies, crunching the numbers, and digesting any publicly available information you can find on this business.

·       Be clear and straightforward. If you want to build trust, and make sure this meeting goes as smoothly as possible, be clear and straightforward about your goals and intentions. Why are you interested in merging with or acquiring this business? What is your long-term strategy?

·       Follow traditional business etiquette. Always make sure to follow traditional business etiquette, dressing somewhat formally, showing up on time, shaking hands, making eye contact, and leaving room for everyone to speak.

·       Get (a bit) personal. Introductory meetings are often somewhat informal – and for good reason. This is a chance for you to get to know the people you're about to do business with, and you can get to know them on a personal level.

·       Ask lots of questions. Come prepared with many questions to ask, and be prepared to answer all the possible questions that might come your way.

·       Don’t dig too deeply. You might have some burning questions about the company's finances, or you might be hesitant about certain aspects of the business, but it's generally unwise to dig too deeply into these topics in an introductory meeting. Not only is this unnecessary for the early stages of the process, but it could also sour your relationships before they have a chance to develop.

·       Don’t start negotiating yet. Communications technology enables better business negotiation tactics, but you shouldn't jump straight into negotiations. There will be plenty of time for that as the deal develops more formally.

The first meeting in any merger/acquisition is arguably the most important, since it's the one on which all your other meetings are going to be built. The better prepared you are, the more successful you're going to be. Just remember that this is only the first part of the journey, and you'll need to do research in preparation for each of the subsequent stages.

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