In the world of mergers and acquisitions, the biggest mistake sellers make is not knowing the totality of possible buyers and missing out on the most advantageous buyer type – The Transformational Buyer.
There are countless “commodity” buyers out there stacking revenue and EBITDA. They will buy you for your current book of business alone and fold you and your team into their way of doing business. However:
A Transformational Buyer Changes Everything
The transformational buyer represents the one who needs you the most—strategically, operationally, and culturally. They are the buyer who truly needs the distinct value that your firm offers in order to dramatically enhance or even transform their business. Then, for you, everything changes.
Here are two examples of this dynamic.
Filling a Major Market Gap
A mid-market group benefits broker approached the market looking for an acquisition partner. They were a talented group and had their choice of many suitors who surfaced. However, one stood out: a buyer actively searching for a shop with middle-market expertise — exactly what the owner had spent years building.
The result?
- Seeing an opportunity to fill a major gap in their platform, the buyer paid above-market and rolled out the red carpet.
- Because the seller’s team provided missing expertise, they thrived inside the larger firm.
- Several key employees stepped into executive roles that would never have been available had they stayed independent or sold to a generalist buyer.
Generating Cross Selling Growth
Another owner of a benefits brokerage sold to a regional P&C firm with limited internal benefits expertise. The buyer had a solid client base and an excellent brand reputation — but no expertise or leadership in the benefits space.
The buyer was confident that, if they found the right benefits firm, the cross-selling opportunities would be significant. The seller’s expertise and experience was a perfect fit to provide the P&C firm with that cross-selling ability.
The outcome?
- The P&C firm paid 10% above market compared to other benefits firms.
- The seller was able to shape the future of the benefits division from day one.
- The firm accessed growth opportunities that would not have been possible independently.
Finding the Hidden Gem Opportunities
It’s easy for sellers with a good book of business to find a commodity buyer—all they have to do is conduct a web search. It is much harder for sellers to find buyers looking for hidden gem opportunities on their own, and they tend to get filled quickly.
That is why Rosen Advisory maintains a network of over 100 qualified buyers, including local, regional, and national firms. We understand the different needs and strategic goals of each buyer. We specialize in a custom search process where we match your firm’s strengths with buyers’ gaps and most pressing needs.
The result is that you find that Transformational Buyer and maximize not just financial value, but the legacy, culture, and career opportunities for the team you’ve built.
How We Can Help
If you are considering a sale — or just want to understand what’s possible for your firm — Rosen Advisory can help. We offer:
- A confidential assessment of your firm’s unique strengths.
- Insights from our Buyer Database into which buyers would find your firm most valuable.
Contact us today to schedule a no-obligation consultation and discover the hidden gem opportunities waiting for you.