There are four key elements to compatibility:

1. We must be able to add value to your business.
2. There needs to be a good business fit.
3. Your personal and financial exit goals have to be met.
4. A sense of shared values and business ethics.
 
Adding value to your business
Our primary aim with every business that we purchase is to add value whilst ensuring the company’s ongoing success and growth. We do this through the injection of management skills and fresh capital, and by being able to identify and act upon opportunities for organic growth or acquisitions.

Because Succession Capital invests in multiple companies across numerous industries, your business becomes part of a larger group of companies and can tap into a highly valuable pool of resources. As well as ideas and innovations that are harvested from other business sectors, this provides access to cost-effective management systems, IT systems, expert skills and funding opportunities that may otherwise not be available or affordable to a standalone business. All of which ensure that when you leave the company, you leave it in good hands.
 
 
Business Selection Criteria
 
Because Succession Capital invests for the long term, and in order to ensure sufficient influence over the future strategy and operations of the business, we have a preference for making investments as a majority shareholder.
 


We look for sound, established businesses that offer solid profitability and good prospects for growth. These are our broad guidelines:

1. An established operation with several years of profitable earnings.
2. EBIT range $1 million to $5 million (and above).
3. A respected position in a well-defined market niche.
4. Products/services that are not subject to offshore commoditisation or rapid obsolescence.
5. A diverse base of suppliers and customers.
6. A significant component of recurring revenues and earnings.
7. Potential for efficiency improvements and future growth.
 
 
Shared values and business ethics
 
Before you do business with us, you’ll need to develop a level of confidence in the people behind Succession Capital. Similarly, we will need to become comfortable with you and your key managers and employees.
 

It is important to have shared values and business ethics, along with the capacity to be able to work together with clear and open communication. This extends beyond the negotiation and sale phase, into the transition of ownership, and ongoing operations of the business including routine contact between us and your management team, employees, customers and suppliers.
 
 
A GUIDE TO THE ASSESSMENT AND PURCHASING PROCESS
 
Because every business is unique the purchasing process will vary from business to business, however the general sequence of events remains constant.
 

1. Get to know you and your business

- Overview of the business and industry
- Understand your broad objectives, expectations and timing
- Assess the likely level of compatibility between you and us
- Enter into an exclusive agreement prior to due diligence

2. Preliminary due diligence to ascertain business performance

- Assess the business's markets, offerings and competitive environment
- Review past financials and preliminary customer / supplier information
- Explore strengths, weaknesses, opportunities and threats
- Assess the business and your management team’s capabilities
- Assess past, current and potential performance

3. Formulate a proposal

- Establish the likely value range and key terms and conditions
- Discuss options for a handover and future management of the business

4. Binding memorandum of understanding

- Negotiate price and terms and conditions
- Enter into a binding memorandum of understanding

5. Formal due diligence

- Operational due diligence
- Legal and financial due diligence

6. Sale

- Settlement and payment to you