The Three Levels of Knowledge a Party Should Seek in Selling a Business

Sep 20, 2022

The sale of a business is one of the most sophisticated, nuanced transactions a party can undertake in society.  At the most basic level, it is sophisticated because the sale impacts numerous lives.  Sell a magnificent residence in your community with a breathtaking view and the transaction involves and impacts two households, at most. This does not change whether the transaction value is six, seven, or eight figures.  Compare that with the sale of a small business like a neighborhood bar & grill, that transaction will touch the lives of the seller, buyer, the employees of the business, the customers of the establishment, the vendors for the company, the landlord for the location, government entities from health inspectors to social & community services funded through the collection of city, state, and federal taxes, and a spectrum of other parties. The level of sophistication grows with the size of the company.

The number of parties impacted by a transaction is just one level of sophistication to the sale of a business, a second is the multiple domains of knowledge needed to successfully complete a transaction employing best practices.  These areas can, depending on the transaction, include legal, accounting, business, tax, finance, real estate, franchises, licensing, and others.

The selection of a business broker to represent an entrepreneur in the sale of their business should start with an assessment of the individual’s knowledge, experience, and skill.  The evaluation of knowledge should be performed on three different levels.

The first level of knowledge to be judged is at an individual level.  The professional sale of a business is a consultative sale. An entrepreneur should seek an intermediary that welcomes all questions and can supply guidance based on the knowledge they have gained through practice in the field, mentorship by senior executive leadership in their firm, and education provided from parties external to the entity.  A good barometer for assessing the individual knowledge of a business broker is to see if they have enough confidence in their knowledge to share it with others in a public forum.  IBA, as the oldest business brokerage firm in the Pacific Northwest, is frequently asked to share knowledge with entrepreneur and professional groups.  Recent examples of this solicitation include Charlie Magee & Curt Maier who will be providing both webinar and live presentations at the 2022 Washington Business Fair ( to be held September 24 organized by SCORE for the entrepreneurial community, Seth Rudin who was recently on the podcast, Afternoons with Monique (, and Gregory Kovsky who was the featured speaker at the September meeting of Washington’s CCIM Chapter at the Seattle Yacht Club.  To use a relevant example from this time of year, my children, one in college and the other in high school, both sought the most experienced, knowledgeable teachers on the staff at their respective schools to help advance their academic development as students.  Virtually everyone can look back on their academic experience and identify a teacher who made a positive difference in their lives.  In the selection of a professional advisor, an effort should be made to pick one that can deliver the best result.  Reviews of individual business brokers can often be found in venues like Google and firm websites.

The second level of knowledge that should be appraised is the collective knowledge of a business brokerage firm.  No individual knows everything.  Knowledge is gained progressively over a lifetime.  A wise person has no hesitation in stating, “I do not have an answer to that question, but I know where to get one”.  The value of engaging with a large business brokerage firm is that you do not only gain the knowledge of your lead intermediary, but a team of business brokerage professionals that can engage with you either directly as advisors or that can brainstorm behind the scenes to come up with solutions to issues at hand.  As an example of what is available in the business brokerage community in the Pacific Northwest, the collective wisdom at IBA includes eleven people who have previously been entrepreneurs themselves and successfully run businesses, multiple MBA’s, an attorney, and division directors who previously held executive positions in the technology, pharmaceutical, construction, hospitality, industrial products, and other industries. There are many business brokers who successfully ply their trade as one-man shops or at small firms with a couple of individuals.  They may check all the boxes at the individual level in terms of providing knowledge, but if I was making the decision to sell my “life work” as an entrepreneur I would strongly assess the level of resources available to that individual and the backup support they have if they go on vacation or “get hit by a bus”.

The final level of knowledge that should be gauged in selecting a business broker is the strength of their Rolodex.  The first resource available to a business broker to address a question or situation where they do not have an answer after themselves is commonly the individual’s firm.  However, if an answer is not available there where do they go next. The answer should be the ecosystem the business broker is part of for professional collaboration.  Assessing the strength of a business broker’s network can be problematic as not much evidence in support of it may be found in the public domain.  For IBA, a forty-seven year old M&A intermediary firm that has established itself as a market leader in terms of being a resource for knowledge, the public footprint to our knowledge available through our collaborative partners includes our blog,, which has had over 100 guest authors in its history contributing content for the good of the entrepreneurial community, and our steady stream of collaborative seminars offered to the business community, the next being a seminar for the wine & hospitality industries being held in Walla Walla, Washington in collaboration with Key Bank, the Washington Hospitality Association, and Walla Walla Community College’s Culinary and Viticulture Programs,

Knowledge is the foundation of success whether you are taking your first test of the autumn term or selling a business.  Concentric circles of enhanced educational opportunities exist in most areas.  Read a book on a subject and you can likely go to the library and find a relevant section of more information.  Want more, you can take a class or seek a degree in the area of study.  Selling a business, start with a business broker, expand to their firm, and then seek specific, specialized knowledge from the professional community.

IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community 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”.