FAQ
18 weeks total
2 weeks to gather material and create a confidential pitch deck
3 weeks to meet with buyers via Zoom
3 weeks to analyze buyers’ bids, negotiate with buyers, sign LOI
8 weeks for buyer’s due diligence (which includes financial, legal, operational in-depth analysis)
2 weeks to prepare legal documents (purchase agreements, employment documents, non- compete/non-solicit, etc)
A pitch deck is a 10-15 page document created in tandem with the seller to CONFIDENTIALLY describe the agency for sale. Key components are a trended P&L and Balance Sheet, employee roster, customer analysis, carrier analysis, and analysis of contingent/supplemental/bonus/overrides received from carriers.
No employee or customer names are shared in this presentation. A pitch deck is also commonly referred to as a CIM or Confidential Information Memorandum.
The seller.
Yes. Aside from hiring my firm for our services, you’ll need to hire an attorney for the legal documents and consult with your CPA on the tax ramifications on the sale. I would highly recommend using an attorney with insurance M&A experience. Even if you have a local attorney, you do not want to pay for them to “learn on the job” – there are some great attorneys we can recommend that focus only on insurance M&A.
This is the document that is used for the bank wires at closing. There will be a payment to the seller, a payment to ADBA for our fees, and a payment to your attorney. The seller amount is net of these fees. So while the payment does come from the buyer, it is paid for from the seller’s proceeds.
Some buyers might pay the broker fees. However, the buyers are not willing to pay the broker fee and give the seller full value. So whether the seller pays the broker fees or the buyer pays them, the seller will net the same amount.
Amounts paid to the seller are PRE-TAX. Payments will be due to the IRS and your state. Again, consult your CPA for an estimate of those taxes due.