Shoot the Moon with Revenue Rocket

Got an Unsolicited Offer to Buy Your IT Services Company? Do This First | Shoot the Moon

Episode Summary

In this episode of Shoot the Moon, Revenue Rocket's Mike Harvath and Ryan Barnett unpack what to do when you already have a buyer at the table. They explain why a competitive process typically delivers better price, terms, and strategic fit, and they introduce "deal facilitation," a lower-scope IT services M&A engagement that helps founders evaluate, negotiate, and structure an existing offer from LOI to close. The reality they keep coming back to: in a letter of intent, the no-shop clause is often the only truly binding provision, and there are roughly 150 things still left to negotiate between LOI and close.

Episode Notes

Most first acquisition offers are not the best offers. If a buyer has approached your MSP or IT services company out of the blue, this episode walks through how to evaluate that offer, what a letter of intent actually binds you to, and why bringing in an advisor before you sign protects both your price and your optionality.

CHAPTERS
0:00 Why most first offers are not the best offer
1:45 What changed: a seller's market and nonstop inbound offers
4:45 "I already have an offer" — what an LOI really binds you to
7:00 Why the first offer usually is not optimized
10:15 Mistakes founders make running their own deal
14:50 When to bring in an M&A advisor
18:00 Deal facilitation vs. a full sell-side process
22:00 Control vs. leverage: what an advisor actually does
24:15 The first thing to do when an offer lands
26:30 Wrap-up

KEY TAKEAWAYS

• Most first offers are not optimized. Without competitive tension, you usually leave price, terms, and strategic fit on the table.
• In an LOI, the no-shop clause is typically the only binding provision. The number can still move significantly in diligence.
• There are roughly 150 things to negotiate between LOI and close, from working capital to earnout structure to reps and warranties.
• "Deal facilitation" meets you where you already are  with a buyer or signed LOI, and helps you get to close at a lower scope than a full process.
• An advisor does not take control. They add leverage, while you make every final decision.
• Before you respond to any offer: don't engage emotionally, validate the buyer's credibility and certainty to close, and protect your optionality.

LINKS

• Read more on our blog: https://www.revenuerocket.com/blog/
• Estimate your company's value with our Valuation Calculator: https://www.revenuerocket.com/valuation-calculator/
• Schedule a confidential conversation: https://www.revenuerocket.com/contact-us/
• Listen on Apple Podcasts: https://podcasts.apple.com/us/podcast/shoot-the-moon-with-revenue-rocket/id1478519505
• Listen on Spotify: https://open.spotify.com/show/6y7u9KuOjaplhScHtINGZU
• More episodes: https://www.revenuerocket.com/series/shoot-the-moon/
• Website: https://www.revenuerocket.com

ABOUT REVENUE ROCKET
Revenue Rocket is a sell-side and buy-side M&A advisory firm focused exclusively on IT services companies, including MSPs, cybersecurity, cloud, custom application development, and VARs. Based in Bloomington, Minnesota, the firm has advised technology and IT services founders on mergers, acquisitions, and exits for 25+ years.Shoot the Moon is hosted by Revenue Rocket partners Mike Harvath, Ryan Barnett, and Matt Lockhart.

📞 Received an offer and not sure what it is really worth? Talk to an advisor before you respond: https://www.revenuerocket.com/contact-us/