Many of our competitors, investment bankers and M&A intermediaries alike, enter the field with sharp financial acumen, strong negotiation skills, and a genuine commitment to advocating for their clients. They can weather the ups and downs of an unpredictable income stream, but when it comes to marketing and operational expertise-the very tools needed to secure multiple offers and achieve the best price, structure, and fit for sellers-most fall short.

In this article, I aim to debunk the myth that “industry expertise” and “industry experts” are crucial for effective business representation. Surely, being an industry expert sounds good and may impress sellers, but beware that our competitors who rely on positioning themselves as primarily “industry experts” are almost universally masking a critical weakness: their inability to create a robust market and secure top offers. When you look closely at the methods employed by so-called “industry expert” intermediaries, chiefly relying on a short list of researched buyers and/or contacting their friends in the industry, it becomes evident that their “expertise” does little to ensure a solid outcome for the client. 

I will conclude by illustrating that the real key to achieving the best outcomes lies in a broad, data-driven marketing approach combined with operational excellence. This is the key that has led to Calder Capital’s explosive five-year growth of 766% and three-time appearance on the Inc 5000 fastest-growing private companies list.

The Pitfall of Industry Experts 

Our competitors often position themselves as industry experts because they know it appeals to sellers. Frankly, we do the same thing, and we have a very strong track record – manufacturing, distribution, construction, and B2B service. Sellers, who are experts in their fields-whether it’s machining parts, selling agricultural equipment, or wiring manufacturing facilities-naturally gravitate towards advisors who understand their industry. But when an intermediary continues to harp on their industry expertise as the sole differentiating factor, and their only go-to-market strategy is to go to known buyers, it can often be a critical mistake to move forward with them. 

Let me illustrate this with an analogy. Imagine you own a state-of-the-art, climate-controlled CNC shop specializing in tight-tolerance parts. Business is slower than you’d like, so you decide to drum up new clients by knocking on doors in a local industrial park. The owner of Smiths Prosthetics Manufacturing invites you in and shows you blueprints for a big upcoming job. You know your shop can handle the work flawlessly, but when you mention your lack of experience in the prosthetics industry, the door slams in your face. You walk away, knowing that your automation, process, and equipment could have saved the owner significant money-but he never gave you a chance. If only you had the chance to show him your equipment, process, quality control, and pricing. 

This scenario plays out daily for intermediaries who can’t demonstrate experience in a specific industry despite having the skills and resources to deliver superior results. The irony is that many “industry expert” M&A advisors run a lackluster market creation process, a process that relies on calling their friends and stifling all forms of marketing that would attract the right buyers, which means that sellers aren’t maximizing the value of their businesses-even if they believe they are.

The Flawed Process of Industry Experts

Many “industry experts” rely on a narrow network of buyers they’ve cultivated through a handful of deals in the same industry. They will then combine this list of friends with a researched list of additional prospective “buyers.” For example, an investment banker representing an electrical contracting company might use databases like Pitchbook or Dun & Bradstreet to compile a list of 150 potential buyers. 

This sounds impressive until you realize the limitations of this approach. To break it down using statistics, approximately 20%-25% of contacted buyers will want to receive more information, or 38 in this example. Of those, 10% will submit an indication of interest or letter of intent, or ~4. With 4 offers, you will be lucky to get one solid one and will have little negotiating power or insurance should your top buyer fall through. 

Another issue is that most of our competitors try to pare down their list because they know they need to manually call, email, and send letters multiple times to get the attention of most busy executives. In other words, they work hard to limit the marketing of your business because they have not invested in a robust internal process or resources to process healthy buyer interest. How is limiting the offers on your business in your best interest?

The Alternative: A Robust, Broad-Based Marketing Approach

Now, imagine if, instead of contacting 150 buyers, the intermediary reached out to 15,000 buyers, all while maintaining confidentiality and never missing a beat following up multiple times. The odds of receiving 10+ solid offers increase dramatically, giving you the power to choose the best fit and structure for your needs. Unfortunately, few intermediaries have the resources, time, or operational efficiency to manage such a comprehensive process.

At Calder, we have differentiated ourselves by using data analytics and automation to reach out to and follow up with buyers multiple times via voicemail, email, and text messages with statistically compelling messages. We know buyers are considering multiple opportunities, so we must capture their attention. Our continued investment in automation allows us to market aggressively without fear of losing control of the process or becoming unresponsive to buyers-a problem that, interestingly, is a top complaint buyers have about intermediaries.

We combine the traditional researched buyer method with our own growing database of 206,000+ business owners, buyers, and professional advisors. We market a confidential blind overview to this entire database, advertise on every major business-for-sale listing site, and optimize our website (which receives over 18,000 monthly visits from new buyers) to attract buyers to your business confidentially. The result? We routinely and thoroughly screen and approve 200-300 buyers per client, receiving 20-30 offers, including 5-7 exceptional ones. This leads to offers that often exceed our clients’ valuation expectations by 20% or more. 

Case Studies

In one recent example, we represented an $890K EBITDA niche machining manufacturer, ultimately negotiating a successful sale multiple of 5.62x EBITDA. The sale multiple was 1.46x higher than the average of 8 comparable transactions identified pre-sale and .66x higher than the highest comparable. In order to achieve this, 159 buyers were approved to receive the CIM, and 21 buyers submitted offers. Prior to working with Calder, the seller was represented by a broker for over 12 months, which brought them no offers. When we met the seller originally, the owners felt that the company might not be sellable!

In another example, we represented a $1.8M EBITDA building products distributor who had previously been represented by an “industry expert” advisor who brought them zero offers in 18 months of representation. This “industry expert’s” go-to-market method you ask? Contact 25 larger companies in the industry every six months (the same ones, three times over 18 months). How creative! Calder sold the business for an all-cash higher offer than they expected in less than 5 months start-to-finish.

Wrapping It Up

In conclusion, the myth of industry expertise as a crucial factor in successful business representation is just that-a myth. While industry knowledge may initially impress sellers, it is often a mask that leads to a narrow, ineffective process that falls short of maximizing deal value. At its worst, it can leave the seller wondering who the intermediary is really working for. The real key to achieving the best outcomes lies in a broad, data-driven marketing approach combined with operational excellence.

At Calder, we understand that securing multiple offers is essential to ensuring the best price, structure, and fit for sellers. This is why we invest heavily in data analytics, automation, and comprehensive outreach strategies that go beyond the limited scope of industry expertise. By reaching out to thousands of potential buyers and maintaining consistent, compelling communication, we create a competitive environment that drives up offer quality and quantity. The results speak for themselves: offers that frequently exceed our clients’ valuations by 20% or more and a process that prioritizes the seller’s best interests over the comfort zone of the intermediary.

Ultimately, it’s not about who knows your industry best-it’s about who can market your business most effectively to the right buyers, and Calder has the tools, experience, and commitment to do just that.

Testimonials

“After a number of attempts with other brokers, Dennis and I had little faith in our ability to sell the business. However, after our first meeting with Calder Capital, we were given hope, in large part because we felt Garrett understood our vision and appreciated the importance of finding the perfect buyer to acquire Thread-Craft. We were looking for a specific buyer who had manufacturing experience, had a desire to grow the business, and was committed to keeping our workforce intact. Calder Capital and Garrett Monroe found a perfect fit in The Depatie Fluid Power Group and we will be forever grateful. Garrett’s unwavering support, hard work, expertise, diligence, drive, and attention to detail were instrumental in navigating the complexities of this transaction. Garrett was truly the reason this transaction was successful; he is more driven than anybody we have ever known. Without Garrett’s commitment and partnership, we wouldn’t be where we are, celebrating our retirement.”

– Celeste Johnson, Former Owner, Thread-Craft, Inc. (Seller)

“After a number of unsuccessful rounds of trying to sell our business with other brokers, we were introduced to Max Friar and Calder Capital. We really appreciated their honesty, energy, and enthusiasm. We are happy to say that in less than six months after working with Calder, we had negotiated a successful transaction with the right buyer for the future of our company. We are very pleased to recommend Max and his company to anyone seeking to sell their company. Max clearly goes above and beyond what others are willing to do to bring success to their clients.”

– Patrick Corbett & Jerry Shear, Founders, C&S Electric Service (Seller)

“Working with Garrett and Calder Capital was a 10/10 experience. Compared to the other brokers I interacted with, he was an 11/10! He was great every step of the way and very diligent in his efforts.”

– JoAnn Hinds, Former Owner, Diamond Die & Mold (Seller)