Small businesses on the market worth up to $100 million are not finding the right buyers to maximise their sale value, says Lindsay Karathanassis, founder of Linkara Capital.
Karathanassis believes many SMEs are being sold short because business owners and operators cannot find appropriate buyers despite a strong market in Australia for small businesses.
“Lack of owner confidence in the buy/sell process means many valuable businesses are failing to sell to the right buyers for the right price,” he said.
While plenty of Australian businesses have been built from the ground up by astute entrepreneurs, there is a significant lack of knowledge in the selling process, Karathanassis noted.
“[Business owners] frequently do not know how to value their business or where to find a buyer. They also do not yet understand just how complex the process can get and how long it can take.”
Owners are often intimidated by trade buyers and this lack of confidence leads to a sale that is either below the business’ value or handed to an inappropriate buyer. Karathanassis urged small business owners to consider their organisation’s legacy before rushing into a sale.
“The deals are there to be optimised but it is very evident to us that companies operating in the small to medium space need expert help to achieve their goals,” he said.
Karathanassis’ experience comes from specialist business services firm Linkara Capital, which provides advice on buying and selling businesses between $1 million and $100 million, as well as obtaining finance and preparing a business for its future through investment activities.
Do you have a business sale plan?