In the hectic day-to-day of managing a business, few CEOs have the chance spend much time thinking about their company’s strategic value proposition from the perspective of an outsider. Of course, CEOs and executives usually are keenly aware of their company’s differentiated solution offerings or ability to win business from competitors but there is less of an opportunity to delve into the same key metrics that a strategic partner, investor or acquirer would. Put another way, what makes your company special compared to all of the other companies in your market? When given only 90 seconds to highlight the unique and stellar attributes of a business to an audience not looking to buy your product but seeking to potentially buy the whole company, what should you focus on?
The answer to this question may very well include why customers chose your company’s solutions in the first place but it often goes far beyond this. Yes, a strategic partner, investor or acquirer wants to understand what your company’s products do or what services your team delivers but assume for a moment that they know that already. Now, what they really want to understand is why you stand out from the pack.
Maybe it is your intellectual property – your company has developed patented technology that is far ahead of the market and it would take years to try to build a competing solution. Or maybe it is a unique sales and marketing approach that has differentiated your firm from its peers. Perhaps your brand is the asset that is hardest for competitors to replicate and is a significant driver for your future success. Your company’s strongest differentiator may be an entrenched customer base of premier and loyal clients or contracts with a recurring revenue stream that would be nearly impossible for a competitor to win away. The specific attributes that make a company stand out and command a valuation premium vary widely across businesses and industries but the importance of being able to clearly community your company’s value drivers is universal.
Time is limited and attention spans are short, whether you are pitching your products to customers or your business to an external audience. There is a finite window to grab your audience’s attention and entice them to spend their time and resources learning more. Messaging needs to be on-point and specific to the nature of the discussion as well as specific to your audience.
The old adage that beauty is in the eyes of the beholder is quickly apparent when building successful partnerships, engaging with investors and exploring an acquisition. It is important to clearly be able to articulate all of the unique attributes of your business and what makes you successful in your marketplace. It is often equally important to be able to recognize what the value proposition is to a specific acquirer, investor or strategic partner. Your ability to define and articulate your value in a way that resonates with each party may be the gateway between an interesting first meeting and a long-term relationship.
Erin Lucien’s business, Springstone Advisory Services povides a range of corporate development consulting services that enable organizations to achieve growth objectives and maximize results in a future capital raise, M&A event or strategic partnership.
Erin has over 15 years of experience in merger and acquisition transaction advisory, strategic consulting and valuation services. Over the course of her career, she has been involved in the execution and evaluation of sell-side and buy-side transactions for over 20 technology companies.
You can view her profile HERE.