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3 min reading time
Our fourth 10x Medical Device Conference was a great success in part from presentations like the one I’m sharing with you today.
Mid-market M&A specialist Deborah Douglas told us how to determine when it’s time to sell your medical device company.
Full access to the video, slides, and transcript here: http://medgroup.biz/time-to-sell
• There are rule-of-thumb pricing mechanisms that are okay but they probably all go away when you get the right competition. I would say rule-of-thumb for a medical manufacturer might be 5.5 to 7.5 times EBITDA.
• The time to sell is when the trend is up. If I look at companies over a long term they grow kind of gradually then they level off a little bit and then eventually they drop down. You want to sell sometime in that upward path.
• If you get the right competition bidding, it can make a big difference.
• It’s a cyclical market. I feel very good about 2016, less so about 2017 and 2018.
The transcript includes a list of questions to ask unsolicited callers about selling your business and what happened to the guy who turned down a $50 million offer.
Read this: “A lot of our clients come to us right away and say, ‘Oh I know who the buyers will be. It’s one of these three or four guys.’ Really common and they were always wrong.
I’ve learned over time they think of the guys that are most like them that are out in the marketplace or they tell me, ‘Well so-and-so would pay a fortune just to have us gone.’
No they wouldn’t, not usually. People don’t pay just to have you gone; they pay for earnings capacity you can add.”
Watch the video or read the transcript (no login required) at http://medgroup.biz/time-to-sell
My biggest takeaway from Deb may seem obvious but I bet those who go-it-alone ignore it: Multiple bidders make for higher prices. Deb said, “For an average seller, our firm will talk to 300-400 buyers.”
For today’s discussion, what’s the best advice you received or heard about when to sell the company?
And if you’re thinking of selling, you might want to talk to Deb: https://www.linkedin.com/in/debdouglas
IMPRESSIVE MINNEAPOLIS EVENT JUNE 6-8
I joined the MedForce 2016 Summit as Day One Chairperson because I’m impressed with the speakers and agenda they’ve assembled.
They made an AMAZING 70 PERCENT DISCOUNT for Medical Devices Group members (device manufacturers only). It’s $599 instead of $1998, a $1,400 savings!
And if you can’t make the whole event, manufacturers can join (for free!) the Networking Cocktail Reception on Monday night (June 6 from 4:45 – 5:45pm).
To get the $599 rate (or free reception), contact my friend Ellen Rapoport and tell her “Joe Hage sent me.”
Ellen’s phone: +001 646 200 7482
From the MedForce brochure:
MEDFORCE 2016 is an interactive conference on both Multi-Channel Marketing and Sales Force Effectiveness/Training and Development for Medical Device and Diagnostics Manufacturers. Our conference model is very interactive – we have 35 speakers from the top 100 largest manufacturers, as well as mid-sized companies.
I hope to meet you there!
Love from Dubai,
P.S. I really have to thank Ellen. I never expected a 70 percent discount for the group. Take a look at the site for the A-list speakers and agenda: http://medgroup.biz/MedForce2016
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