Ok so I am going to share some personal insight and experience about a controversial topic among Businessmen and Businesswomen. Business Brokers. “To use and trust or not to use and trust. Is the question?”

I have been told by some of my partners Business Brokers can be useful if you know how to avoid the traps and have experience associated when negotiating transactions. However I have yet to see a Broker who is not a full out Online Lead Machine and Robot. This is just so unattractive. And makes me feel like they are a Drive Through Burger Shack or worse Convenience Store. They are sales heavy and usually I would not use a broker for any reason except Multi Family Real Estate. The reason I say this is because the first rule I was taught by my Mentor who is a Fortune 500 founder and has his own PE Fund. He shares “When looking for deal flow as a Private Equity investor. Or as a Partner of a Fund. “All the very attractive deals are going to be usually off market. Difficult for us to approach and buy.” Frankly when I look for deals they must be entrepreneurial journeys and approach’s. Nothing is a free lunch in Business. 100%

Always be looking for Deals.

This should sum up my advice as a Entrepreneur. Always be looking. Most people go throughout their day going to work, shuttling the kids to the Dentist or School without ever paying attention to the details in their environment. Entrepreneurs I suggest you do pay attention. And should always be on the look out like a hawk for the next diamond in the rough deal. If you spot a building with personality or character in downtown Kansas City? You may be on to something big. Trust me. It’s worked for me. Watch for that story soon. But usually Experienced Smaller Private Equity Shops and Small Business Owners who have a few transactions under their belt. Use Brokers as a way to sit back and let them bring them Deal Flow. This has it’s own set of issues. But for now. I want to demonstrate how this kind of works.

Business Brokers Are Like Sales Robots

Most Business Brokerage’s do have forms on their websites for qualified and unqualified Business individuals to be sorted as a Meat Wagon Intake. I mean this with complete humor. Hahah. Avoid these processes if you can. From my experience. I am more of a Businessman who likes to develop trust and long term relationships if I am going to be doing business with someone. I just have to have that personal commitment and professional development time to really feel like the opportunity is not some fly by night Deal that could wreck my career and future.

People in the Sales community do not have the motivation to look at and conduct deep investigations for Due Diligence like YOU. Remember every person on the other side of the table wants to succeed and get PAID. And if corners are cut? Which they probably are sometimes. You must remember that its your responsibility as the new Owner to investigate thouroughly. Nothing will be as powerful as your own Due Diligence investigations and referring to Professional Experts offering Advice.

Here is the cool thing about Business Brokers. If you have established healthy working boundaries and trust, they will bring you off market Deals or Opportunities. That is paydirt.

Experience Matters

I am only able to write about my experiences and personal suggestions on this blog. So I am really positive my criticisms and cynical views won’t be winning me any Friends by discouraging Entrepreneurs from using Business Brokers. I find it easier to use my own creativity and approach business owners when asking them to have a conversation about their future and retirement options. There is a strategy I use to evaluate if a Business owner seems like a good Acquisition possibility. I will be writing more about how I do this so please stay tuned. However leaning on your Partners Business Experience will help you jump start your Acquisition Entrepreneurship journey. But it will be up to you to take the lead. Business Brokers in my humble Opinion should only be used if you A. have established Rapport. B. Have Mutual Respect. and C. Know you can trust the person as the intermediary.

Trust Is Everything

When picking a Business Broker I was able to hack the system of Robotic responses. Here is what I did. But first you need to know that Trust is everything. In order to establish some trust have the Broker or Firm you contact refer 3 previous Clients who have experience doing deals with this firm. Then ask for 2 Clients who did not complete a transaction. Take these introductions as serious referrals. Because in the end. You can not afford to screw up. Trust will come when your comfortable that the person wanting you to sign a NDA is not a Scheming Con Man or Woman.

In the end I am going to detail my thought pattern of trust. Because if your left with more questions than answers when dealing with Business Brokers or anyone in general. Follow these steps.

• Trust
• Trust But Verify
• Take The Matter Under Advisement

As my friend Marcus Lemonis say’s “Trust the process.”

Thanks for reading.

JS.