Download a company overview and a list of advantages here.

Download a high-level product overview here.

We want to send you a company details, feature lists, product details, forward financial projections, and a high-level ramp-up plan for revenue growth.

We encourage Strategic Buyer candidates to participate in our Start Today program. The ground-breaking Start Today program includes full tech support and guidance, and provides a complete state-of-the-art online training system. The prospective buyer will thus learn how the company's flagship product works, what it looks like, and how to create online courses.

We believe in risk management, so we encourage you to utilize a "path to acquisition", rather than an unpredictable all-at-once event. We offer two options, both of which are economical and which provide an exploration of the FlexTraining system and even some experience in selling in the Learning Technology space. The result is that you will understand the business before you plan for an investment.

If you are serious enough to spend some time learning the product and technology provided by this company. please contact us here.

If you are looking to acquire (or sell), a small tech company you will want to be clear on the two types of buyers who can be found in this market: Strategic Buyers and Financial Buyers.

Based on years of experience working with buyers, self-proclaimed buyers, tire-kickers, business brokers, operating companies, and M & A advisors, we offer the following guidelines for distinguishing a Financial Buyer from a Strategic Buyer.

Background:

A tech company that is for sale is basically offering two components: One is essentially a "Financial" component (for example: historical cash flow, maintenance contracts, and service agreement renewals). The second we might call the "Product" component, which is the product asset which generated all the prior cash flow, and will be the basis for generating future cash flow. In the software industry, this is the Intellectual Property (the IP), the software itself.

Thus there are two significant components in the valuation of the company: Historic/Financial and Product/Growth Potential. And either one may be larger than the other, depending on the circumstances. The important fact is that both are significant in almost all cases.

So here are some of the main characteristics of a Strategic Buyer:

1. Strategic Buyer typically pays from its balance sheet, perhaps a using fund established for the purpose of expansion.
2. Strategic Buyer has an operating company with a marketing and sales function.
3. Strategic Buyer is always a company, not an individual.
4. Strategic Buyer company has some synergy with target company, in products, services, industry niche, or markets served.
5. Strategic Buyer will be asking a lot of questions about the product.
6. Strategic Buyer will be developing a "scale up" plan to leverage their resources to increase sales and penetrate new verticals or market "spaces".
7. Strategic Buyer understands the contribution of both value components - Financial and Product - and knows that a value must be determined for each.

And here are some of the main characteristics of a Financial Buyer:

1. Financial Buyer may be an individual or a company.
2. Financial Buyer typically needs to finance the purchase of the target company, using a bank and/or the SBA. This will likely severely limit the price the Financial Buyer can pay. Banks understand only historic cash flow, and not industries, products, or intellectual property, and thus may only be willing to finance about half the purchase price.
3. Financial Buyer needs an earn-out from the seller, because they have limited cash for the closing.
4. Financial Buyer will be asking a lot of questions about the historical and planned cash flow based solely on existing operations.
5. Financial Buyer may not grasp or wish to acknowledge the value of the Product (growth) component, and therefore will discuss valuation as if there is only one component: Financial (historical or contracted cash flow amounts).
6. Financial Buyer will be not be focused on how to grow the business by leveraging their current marketing and sales resources, because they don't have such resources.

How these differences play out:

A "buyer" will respond to an ad placed by the seller or its broker, and will request information from the seller, usually without providing much information in return. It costs them nothing to do this. These individuals and companies tend to look at the seller as an "Information ATM" - not a good place to start a relationship!

The seller may furnish some information and will start to ask questions to qualify the interested party. Of course the buyer will state that they are a "strategic buyer" even though this may be based on no more than the fact that they used to own a small business years ago.

What follows is usually an exchange of additional information, which may include product demonstrations, lists of customers, financial reports, and other data. Eventually the buyer will probably reveal that they have no funds and will need to use a bank or the SBA to finance the purchase. And since the bank will only finance half the needed amount - surprise! - the buyer will need a massive discount or an enormous earn-out to make the numbers work.

The seller should recognize that the game is essentially over, but many do not. Some are highly-motivated and will do just about anything to make the sale. And this is what the buyer was hoping for - indeed it has been their only option all along. And again, it's all free.

There is nothing wrong with being a financial buyer. Many people make a good living this way. But it's important that the potential buyers are disclosing information about themselves along with the seller during an early "discovery" phase. This prevents time being wasted, and makes the process work better for everyone.

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