The Seven Virtues that Every Business Broker Should Possess as a Professional

Jul 25, 2023

The moral & ethical foundation that exists in successful societies is often sourced from religious teachings. The most common educational environment for teaching fundamental principles like you should not kill, steal, lie, or covet is the family.   It is difficult to have the concepts resonate and become engrained into practice if they are not taught at a young age by the most important mentors in all our lives, parents supplemented often by extended family (Siblings, Grandparents, Uncles, Aunts, etc.).   I have been blessed during my life to have had family, friends, colleagues, clients, and collaborative partners of a broad spectrum of faiths who have consistently demonstrated integrity in their activities as role models and contributors in my life.

As an academic, I have studied many foundational religious texts in an effort to compare and contrast the teachings that are part of the lives of good people around the world.  One area of teaching, that has intrigued me in educational research, originating from the Christian faith is the Seven Deadly Sins and Seven Heavenly Virtues ( As a positive person who believes lessons can be learned from all and embraces the possible, this article will focus on the positive virtues and how they should be an expectation by clients and incorporated into practice by a quality business broker.   I have attempted to demonstrate these virtues personally as a mergers & acquisitions intermediary and weave them into the corporate culture of IBA as its President & CEO.

The first of the Seven Heavenly Virtues is Faith.  Faith is defined in this context as the “Belief in Doing the Right Things”. What are the expectations parties should have of a business broker and each other in the facilitation of a transaction, if things are being done the right way?  I believe they are as follows:

  1. Communication – Information shared, whether in person, verbally, or in writing, should be timely, comprehensive, and honest.
  2. Knowledge – The information and documentation necessary to make educated decisions should be provided. No material facts should be undisclosed.
  3. Skill – Actions taken should be performed at a superior level of aptitude.
  4. Resources – If a seller or buyer does not have the ability to make a decision from a foundation of knowledge, the intermediary facilitating the transaction should supply information or incorporate professionals who can address the deficiency. In a business brokerage context, this often takes the form of recommending both sides seek legal & accounting guidance to address shortcomings in knowledge prior to making decisions that will result in tax and other liability creation post transaction.

The second virtue is Hope.   Hope is the outlook that a positive outcome will be achieved.  In a business sale transaction, the business broker is the trusted guide selected to lead the buyer & seller on a journey that will often take a path through difficult environments and terrain before reaching its final destination.  It is important that an M&A intermediary keep the parties focused on the ultimate goal, work on the problems at hand, and not delve into areas of personal criticism of the parties or their professional advisors.  It is not happenstance that positive phrases like “win-win” and “getting parties to yes” are articulated by business brokers in the process to describe navigating issue turbulence.  If people are communicating a positive outcome is possible.  When people stop talking, no progress can be made.

The third virtue a business broker should demonstrate in facilitating a transaction is Charity.  Charity is defined as a willingness to help others in times of need.  There is an old saying in professional negotiations, “An intermediary has two ears and one mouth.  They should listen twice as much as they talk.”  It is critical that a high caliber mergers & acquisitions intermediary be a good listener.   Issues and concerns that are off the radar will not be addressed.   Areas of concern festering in parties’ minds can be large or small, substantive or non-material.  Examples from transactions of issues that I have addressed after listening to the parties have ranged from a seller’s desire to stay on company health insurance until Medicare eligibility is achieved post sale to a need for the selling owner to come back and executively manage the company when the buyer went overseas for a wedding post-acquisition to a carve out in a non-competition agreement to allow the seller to use their skills to help non-profit organizations (e.g., a carpenter helping to build homes for women leaving abusive environments).

The fourth virtue a business broker should personify is Fortitude.  Fortitude in this context is defined as possessing the attitude of never giving up.  A key to never giving up is to set appropriate expectations.  Both buyer and seller in a business sale transaction are often unfamiliar with the intricacies of the process and the associated time periods for activities.  A seller who believes a buyer will be located immediately or a transaction will be completed in a few weeks is not being realistic.  Similarly, a seller that believes they will not need to help the buyer address the needs of a lender during underwriting when they have the greatest depth of knowledge about the company or that the process will not be invasive and time consuming has not had their expectations properly set. Conversely, a buyer who demands immediate results from a seller who has a “day job” running the company while working on a deal is not living in the “real world”. A business sale is a marathon. It takes significant fortitude by the buyer, seller, and their professional advisors to get through the process.  Walking off the journey at the 24-mile mark in frustration with hands on your hips and not finishing the entire 26.2 miles can often appear to be a way to end the pain, however digging deep and finding the strength of will and the necessary effort is likely better than the alternative of starting the race again. It should always be recognized that deal issues with one buyer frequently reemerge in negotiations with another (e.g., a customer concentration concern for a company likely is a concern for present ownership and will also be for their successor at the helm).

The fifth virtue a quality business broker should possess is Justice.  Justice is the desire to be fair and equitable when dealing with others. The overarching corporate principle at IBA is the “Golden Rule” of do unto others as you would want them to do to you. We ask each buyer and seller in transactions facilitated by our firm to conceptually walk to the other side of the table periodically, look at the deal from the other parties’ side, and ask themselves if the situation was reversed would they be willing to do what the other party is asking financially and legally?  The definition of a “fair deal” is one where each party feels they gave up a little too much. A knowledgeable, experienced business broker should be able to provide recognizance on what is standard, common, and presently occurring in the marketplace.

The sixth virtue a business broker should have is “Prudence”.  Prudence is defined as care and moderation with money in this context.  Business sale transactions are expensive for both the buyer and seller. The expenditure only has benefits if the deal gets done.  Empathy and assistive restraint should exist across the negotiating table related to the costs the other party is being asked to burden from taxes on sale to interest rates on debt to legal expense associated with properly structuring the deal and mitigating post transaction liability. One of my multiple decade frustrations in this business has been when attorneys seek to enhance their own financial benefit from a transaction by not doing the right thing (Faith) creating unnecessary confrontation and employing Prudence in the expenditure of the money of their clients.  I cannot tell you how many times as a professional intermediary I have known at the start of a negotiation between lawyers where the middle ground was on an issue (Frequently, in representation, warranties, and indemnification) only to see thousands of dollars of expense accumulated for their clients attempting to achieve results they did not have an expectation of occurring.  I have also witnessed attorneys who have charged based on the size of the deal not their work product to my disappointment.  Fair compensation for labor is a principle I strongly support.  Advantageous billing based on time & place circumstances is something I detest whether it is an auto repair shop that increases their rates for a stranded tourist because they will never see them again or an attorney who recognizes that the seller in a retirement sale transaction will never be needing their services in the future.

The final virtue an M&A intermediary should possess is Temperance.  This relates to what they charge for their services.  Hiring a professional business broker is a significant financial commitment.   In a perfect world, the decision will result in a business seller achieving a strong market value for their company generated from a competitive group of buyers in a transaction facilitated with knowledge, experience, and high skill employing best practices. A top tier intermediary will complete a transaction for 10 – 20% more than an average business broker in a more timely transaction. There is also a higher probability of completing a sale and receiving more cash through a selection of a transaction negotiator/facilitator with a track record of high performance. A willingness to take compensation as a success fee only if a completed transaction is achieved speaks volumes about a broker’s confidence in their ability.  Questions should be asked about whether motivation is sincere when retainers and administrative fees are requested with little accountability with performance metrics.

IBA has been honored to be a part of the Pacific Northwest business brokerage community for approximately fifty years with over 4200 successfully, completed transactions on our resume in Washington, Oregon, Idaho, and Alaska.  We have always wished our competition well and encouraged them to help us build the best possible reputation for the industry. We ask to be included in any entrepreneur’s interview process when selecting professional representation. If we cannot articulate successfully why IBA is a superior option to facilitate the sale of a privately held company, family business, or owner occupied commercial real estate, then we should not be asked to take on the project. We are happy to meet with business owners in our physical offices in Bellevue, Portland, Spokane, and Bend; on location at a business throughout the region; at alternative sites; or virtually. All conversations with IBA are held in strict confidence. Society is a better place when high expectations are set for its members in performance and efforts are made out of generosity. Small actions can be contagious. I encourage you to open the door for someone, return a shopping cart from the parking lot to a grocery, pick up litter, share a smile, and/or read a book or play a game with a child.  Thank you for being part of my world.

IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, mergers & acquisitions, real estate, legal, and accounting communities on subjects relevant to the purchase & sale of privately held companies and family-owned businesses.  IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.