How much of this can be learned by reading a couple books? I wonder how much higher profit he actually made compared to if one could self teach these skills.
You can learn a lot of information from books. What upu can't get from a book is experience.
In this case you have a seller with no experience, and ultimately a buyer with no experience. In either situation a broker is valuable. In the case of both its an enormously important moderator who can keep both parties on track to a successful conclusion.
Having dabbled in some deals like this, books can give you some general ideas, but by nature they won't be current. A lot of things change quickly in the market, especially for smaller deals like this. A company or market segment that was getting a 5x valuation last year could be at 8x now, or 2x. Also, in many cases the buyers are more experienced than the sellers, though that doesn't seem like it was the case here. Your broker can help inform you, and prop you up. They can also act as the go-between for many communications, which can help mask feelings, worries, urgency, and other things that don't always help your position in a face to face conversation.
I imagine the broker he used is fairly experienced and well compensated, so he'd have to learn a totally different profession from the ground up without any mentors or experienced people helping him, on top of continuing to run the business, which you can easily argue is worth $90k
Just because you “can” self learn, is it worth the time to self learn? As he mentions in article the deal needs to move fast or one side may bail. If you have amateur hour seller, the buyer is more likely to back out.
This isn’t AdWords where your landing page sucks, and you can just quickly pivot and get some more traffic. There’s only so many serious buyers of a business like this why risk squandering any of them.
It’s a 15% commission to massively reduce the risk to seller and time commitment. Assuming broker is competent they’re going to get the deal done right. Seems well worth it to me.
He also mentioned having a kid soon, so why drag it out? Dude already made almost a cool million what’s 90k in grand scheme of things to get deal done and money in bank?
Skipping a broker in an extremely high friction transaction is penny wise pound foolish. If residential real estate hasn’t figured out yet how to cut out brokers, business acquisitions definitely have not
