As a buyer, seller, broker, and minority investor, I’ve been inside a hundred deals.

But this one deal I recently worked on as a broker was hands down the most competitive listing I’ve ever been involved in.

One week in, I had already turned away over a hundred buyers. The demand was so intense that people were practically throwing themselves at the seller.

I had buyers saying, “I’ve bought three companies in this space before, and I’m paying cash.” And I had to tell them, “Sorry, you’re out.” The level of competition was unreal.

In the end, I scheduled 21 calls with potential buyers.

Not only is that a lot of buyer-seller calls, but typically, after about 10 or 12 of these, sellers start to hit a wall.

If you’ve ever hired for a key position in your company, you know what I’m talking about. After conducting a dozen solid interviews, you’re exhausted. Even with the best candidates, it can be draining. You’re still spending 12 straight hours answering the same questions, sizing people up, and trying to gauge who’s the best fit.

This seller was an absolute machine, though. It’s no surprise that her business had as much demand as it did. She ended up powering through 15 hours of buyer calls, and by the end of it, she had 26 offers in hand.

Looking back, there were two big questions that stood out.

First, why was this business so incredibly popular? What made it stand out in a sea of other listings?

And second, with so many buyers lining up, how did the seller ultimately decide who to go with?

 

Why Is This Business So Popular?

Let’s start with what made this business such a magnet for buyers. Several key factors drove the demand for this business:

1. A Strong Seller with a Proven Track Record
2. Clear Growth Potential
3. Professionalism and Transparency
4. Upward-Trending Financials
5. High-Demand Industry
6. A Well-Crafted Sales Package

 

I’ll explain.

First off, the seller was an Ivy League grad with a serious corporate background. She had worked in a high-growth startup that scaled into a massive firm, moving across multiple divisions and honing her skills in team-building and process development.

When she bought this business, it wasn’t a mess per se, but it was analog. No systems, no automation, no real structure – just an old-school operation that had been doing things the same way for years.

She changed all of that. SOPs everywhere. A well-structured team. A dialed-in, efficient business.

Secondly, for as much work as she did to clean up the business, she didn’t love working on growth. This produced a business that had great bones and clear growth potential.

Although the seller did an incredible job transforming the business, driving growth in the business felt like work to her. She wanted to run a clean, optimized company – not spend her time chasing expansion.

So when I looked at the business, I saw immediate, obvious growth opportunities. Nothing requiring some breakthrough strategy or tons of capital – just straightforward, low-hanging fruit that was easy to execute. And buyers love that.

 

 

Thirdly, she was a compelling seller and carried herself incredibly well. She was professional, direct, and clear about why she was selling. There was no mystery, no hesitation – just a well-run business from a competent owner who was ready to move on. That kind of clarity removes friction from the process.

The fourth factor was the financials. They were already trending up, even without a growth focus. Buyers weren’t stepping into a turnaround play. They were stepping into a machine that was already running well, with massive potential just waiting to be tapped.

The fifth factor was the industry itself – this was a highly desirable space with strong tailwinds. Even without the other five factors that made this business highly sought after, the industry alone would have attracted buyers.

Lastly, the sales package was well-crafted. We spent four months preparing the deal before taking it to market. I worked closely with the seller to refine the P&L, avoid inflated add-backs, price it fairly, and structure the package so it sold itself.

And I took my time with it – not just because I wanted to get it right, but because I needed to convince myself how good this business really was.

Every time I found another compelling angle, I built it into the package. Every time I found another opportunity, I added a page that highlighted it.

We weren’t just putting together a Confidential Information Memorandum (CIM). We were crafting a narrative that made it crystal clear why this was an incredible acquisition.

By the time we went to market, buyers could see the opportunity immediately. There were no gaps, no confusion, and no hesitation.

 

Source: Citizens Bank | 4 Surprising 2022 M&A Trends

 

As a result, we experienced a flood of interest so overwhelming that the seller physically couldn’t talk to everyone. Talk about good problems to have!

 

The Reality of Business Sales: Why Most Listings Don’t Sell

As an aside: most people don’t realize this, but somewhere between 40 to 70% of businesses that go to market never close.

The reason? The private capital markets – especially in the sub-$25M range – are completely unregulated. No licenses. No standardized process. No single way to structure or sell a deal. It’s the Wild West.

And because of that, either deals aren’t sellable or a lot of brokers just don’t put in the work to make a deal sellable.

I see it all the time – half-baked listings with outdated financials, missing details, and no clear articulation of why the business is valuable. Buyers open the package and immediately feel like something’s off. It’s vague, it’s sloppy, it’s unclear. And when buyers don’t understand a deal, they move on.

The standard broker model doesn’t help either. It’s all about volume – get as many listings as possible, tell sellers whatever they need to hear to sign the engagement, and throw deals on the market with the hope that some will close. It’s a numbers game.

I take the opposite approach. I spend months making sure a deal is tight before it ever goes to market. Every number is dialed in, every key selling point is surfaced, and the story of the business is clear. That way, when buyers see the listing, they don’t have to figure out why it’s a great business – it’s obvious.

This deal was no exception. I knew it was a great business, as it was easy to understand, easy to approach, and had strong cash flow in a desirable industry. But it still took time to get it right and to make sure the value was undeniable.

 

 

Although I personally wouldn’t have acquired this business since it would have been a conflict of interest as a broker, if I were looking for a business like this, it would have been a no-brainer.

 

How to Win in a Competitive Acquisition

So why do I mention that about deals having a notoriously low sell rate, and what does that have to do with standing out in a situation like this?

Because I’m highlighting where the real opportunity is.

If you’re out there chasing the hottest listings, you’re stepping into a battle with some of the most experienced, well-funded buyers in the game. And in those situations? You’re probably not going to win. With so few deals being sellable, the ones that actually are sellable are going to be in high demand and leave you with little possibility to actually acquire it.

So instead of getting demoralized about the statistics of these top-of-the-line businesses that everyone and their mothers want, Instead, consider this counterintuitive strategy: look for brokers doing a terrible job.

 

Source: Yarn.co

 

I’m serious. Find listings that have been sitting for a while – not because the business is bad, but because the broker didn’t take the time to package it properly.

If the deal feels confusing, messy, or incomplete, that’s an opportunity. Those listings get ignored by fair-weather buyers who don’t want to do the work. But if you take the time to dig in, you can often uncover a great business that’s just been poorly presented.

These deals can be goldmines if you take the time to dig deeper.

Now back to this deal, that obviously wasn’t the case here. This business was packaged exceptionally well, and the market responded exactly how I expected. Search fund investors will tell you: Find a great business and be prepared to pay a lot for it. That’s exactly what happened.

The seller had what I call a champagne problem. Too many strong buyers. Too many great offers. It’s the problem every seller wants to have, but few actually do.

I had priced the business strategically – not at the absolute maximum, but at a number that would drive engagement. I wanted buyers to read the package, understand the opportunity, and then compete for it. And sure enough, the market validated the approach. Buyers pushed the price up right to where a business like this should transact.

Now, what do you do if you find yourself in a competitive bidding war? Here’s how you can stand out.

1. Show Commitment to Buying a Business (Not Just This One)

Sellers want to know you’re serious. Have you made offers before? Are you prepared to execute? A proven track record reassures sellers that you won’t waste their time.

2. Demonstrate Your Ability to Succeed Post-Acquisition

Every seller wants their business to thrive after they exit. Show how your experience and skill set align with this specific business’s growth opportunities.

3. Don’t Obsess Over the Initial Offer Price

When a deal is this hot, the market will push the price up to its natural ceiling. Instead of leading with a sky-high number, focus on positioning yourself as the best overall buyer.

4. Align with the Seller’s Priorities

Beyond price, what does the seller care about? Keeping employees? Maintaining legacy? Understanding these softer factors can make a big difference.

 

How the Seller Chose the Buyer

So coming back to this deal, when we got to the point where the seller had 26 offers on the table, the next challenge was deciding who to go with. I got on the phone with her and laid out the options.

One, she could pick the buyer she liked the most and tell them, “Here’s the best offer I have. Match it, and the business is yours.” Simple. Fast. Effective.

Or two, she could narrow it down to a smaller group of finalists and go from there. Maybe run a highest and best round, maybe just choose based on qualitative factors, but either way, start cutting the list down.

After 15 hours of buyer calls, she had 14 highly competent, well-funded buyers. That’s what made this decision so difficult. There was only one buyer in the mix who, after the call, was clearly not the right fit. Everyone else? Legitimate, serious, experienced.

Even looking at all 26 offers, the majority of them were from strong buyers. Some had repeat experience with other deals we’ve done, others had built great reputations in the space. The reality was, she had about two dozen fantastic options. And when you’re in that position, the decision comes down to a different set of criteria.

 

Buyer Selection Criteria

With two dozen highly qualified buyers on the table, the seller had a real challenge – how do you actually pick the one?

 

 

She ended up using a framework that was very similar to what I use, a simple rubric to rank buyers on four key factors:

• Commitment to buying a business (scale of 1 to 5)

• Ability to succeed post-transaction (scale of 1 to 5)

• Offer strength (scale of 1 to 5)

• Financing ability (scale of 1 to 5)

 

Now, the financing piece was tricky. As a broker, I don’t have deep insight into a buyer’s actual ability to secure a loan, and neither did she. But in this case, the lender holding the current loan wanted to finance the new buyer, which gave us confidence that all the serious contenders could get funded.

And that meant the offer amount didn’t need to be the deciding factor. I told her, “Don’t stress about the highest bid. The market has already told us what the business is worth. Focus on fit.”

At that point, it came down to two things: who was truly committed to buying her business, and who had the best chance of succeeding post-close. That’s what mattered to her.

Buyers sometimes forget this. They show up thinking it’s all about the numbers, when in reality, sellers are making a decision based on much more than just price. They’re looking for someone who’s all in – not just on buying a business, but on buying their business. And more importantly, someone who has the right skill set to step in and make it work.

Every seller wants to see their business thrive after they leave. No one wants to hand over the keys to someone who’s going to drive it into the ground. The best way to stand out as a buyer? Make it clear why you are the one who can take what they’ve built and turn it into something even better.

 

The Takeaway

The best deals aren’t always the ones with the most competition. In many cases, the real opportunity lies in overlooked businesses with lazy packaging. If you can spot the hidden gems that other buyers dismiss, you can acquire great companies without getting caught in a bidding war.

If you do find yourself in a competitive process, remember: sellers care about more than just price. Show them why you’re the right person to take their business to the next level, and you’ll increase your chances of winning – even in a crowded field.

Ready to acquire a business in the next 12 months? The Acquisition Lab is your first stop. Reach out to us today and get on the fast track to becoming an acquisition entrepreneur.