For 18 years and through more than $15 billion in transaction value, DGP Capital's Jack Chang has been advising businesses both public and private on how to get the most out of their business when it's time to sell.
As he's analyzed M&A investment opportunities in these different roles, there are fundamental things he wants to see in each business to have the confidence to recommend an investment or to pull the trigger himself
"It's the people," Chang says. "I know it sounds like a cliché, but it's always the people. It's about whether or not they're focused on bringing in people around them to build out a team to continue the legacy and the performance of the company, understanding that, truth be told, it takes a village to start a company to grow it to get it to scale."
He says whenever a deal he's worked on has had great success, it's because they had great people, the owner cares about their employees, about how their business is perceived, and they care about their legacy.
"It's not an egocentric-driven type of mindset," he says. "It's making sure that the next ownership team that comes in, whether it's private equity or strategic that's publicly traded, is going to take care of their people, because many times these people are like family — maybe not biologically, but certainly they've been through the blood, sweat and tears in growing the company to the scale. And by-and-large, you can do that with a cohesive, well-run and well-incentivize team. And that's primarily what we look for on the sell-side as a private investor in the space."
Chang spoke on the Smart Business Dealmakers Podcast about what sellers can do to make their business attractive to buyers, when they should start the process and who they can turn to for help as they work to maximize their deal.