Preparing for exit is key
Home Contact Us Home-version 2 Service page About Us Office Location Post template Home Contact Us Home-version 2 Service page About Us Office Location Post template Preparing for exit is key Acquisition Strategy, Preparing for exit, Strategic review, Technology December 2, 2025 Preparation for exit is clearly key to success, but how many company owners genuinely practice this when embarking on selling their business? We see so many companies in the TMT sector make the decision to sell only to be disappointed after a long and arduous sale process in which the final price has been chipped again and again by savvy buyers. Selling your company is arguably the most important event of your business career. It would be foolish not to prepare fully for it. -Where to start? The sales process is a multi-event sequence and requires learning a multitude of technical skills and abilities. While most entrepreneurs have plenty of passion and commitment it is unlikely that they will become an expert in the different aspects of selling a business, or even assemble a team that can deliver such a multi-skilled process. A first step would be to find the right M&A advisory firm with an in-depth knowledge of the sector to take you through the entire process. -When to sell and who to? When to sell is a personal decision. Some entrepreneurs have a target value in mind, others might have to sell for personal reasons. There is no right or wrong time, as long as your business is ready for sale it will attract buyers. The TMT sector continues to expand and there are plenty of mid-market players looking to merge with like-minded businesses. Knowledge of the sector and the personalities behind it is paramount as due diligence advisers are known to be canny. -Get fit for sale This can take time. Learning new skills is always hard, and only with total commitment to trial and error do we acquire new abilities to a reasonable standard. All the events or phases in a sales process are crucial. A platform of quality information and reporting needs to be designed and populated so the business will score the highest points through each event, and most importantly arm business owners with the right tools to defend buyer investigations in the transaction phase. Business owners who are determined to achieve maximum value must understand a buyer’s perspective of their individual propositions, strengths and weaknesses, before embarking on value improvement. -Strategic review A full strategic review of your business is crucial. Most companies will want to raise KPI performance before populating an information memorandum template. It is critical for business owners to improve these metrics and remove any obstacles to a sale. Sale processes that do not commence with a strategic review, that have no robust due diligence platform to support the process through to completion, nor commit to a value improvement program from the beginning, are unlikely to achieve maximum value at transaction.Simply squeezing your business into a template to attract offers without any bespoke analysis and metric training is not an option. In fact, research by Evolution Capital has found the biggest challenge facing a business ill-prepared for the sales process is not the lack of reasonable offers, it is achieving a value at transaction that has any semblance to the value agreed when entering exclusivity with a buyer. -Start early Most processes lose more value than they gain in price maximisation through marketing and negotiation than they do in the period between signing heads and entering exclusivity to completion. Why not enter that phase in full knowledge that your business is fighting fit? It is not uncommon to see reductions of over 20 per cent achieved by competent buyers with specialist advisors. During due diligence, difficulties often arise with defending claims made in the company information memorandum document and this generally points to a lack of preparation in the beginning and due provision for specialist guidance in the final phase.Professional adviceWhile brokers claim expertise with transactions, many lack the experience or fail to commit these expensive resources in the final phase of the project. Business models heavily contingent on success require high levels of transactions, which in turn necessitates resources being spread too thinly to deliver outstanding outcomes for shareholders. In many cases, the need for experienced transaction support is critically delivered over a demanding four week period, when business owners are most challenged to defend value. Our experience is that a successful mid-market business sale absorbs many hours of professional advice much earlier in the process, typically between 500 to 1,000 hours of professional advice. Of this at least 30 per cent is set aside for preparation.Transaction dayIt can all still fall apart if you don’t have the right team around you. While training and preparation are of equal importance to achieving ultimate success in a sales process, all can still be lost at the final crucial moment. A good M&A advisory organisation will manage the arduous transaction process, field questions and deliver the right information to buyers, ensuring the right price is achieved.[This was first printed in Comms Dealer Magazine in February 2019] More than 2 results are available in the PRO version (This notice is only visible to admin users) Categories Acquired (2) Acquisition (8) Acquisition Strategy (2) Analytic Services (3) Blog (3) Business Acquisition (1) Business Aquired (2) Business Sale (23) Business Valuation and Research (1) Buy-Side (1) Buy-side M&A advice (1) Buyside M&A (3) Case Studies (59) Disposal (5) Financial Due Diligence (2) Fund raising and listing (1) Fundraising and M&A advice (2) ICT (2) IT (2) IT Managed Services (2) IT MSP (1) M&A Managed Buy and Build Programme (5) Managed Service and Mobile (1) Managed Services (2) MBO Management Buyout (1) Media (1) Merger (1) Multiple R&D Tax Claims (1) Sell-Side (2) Sell-side M&A Advice (1) Software (1) Strategic review & business sale (1) Strategic Review & partial sale (1) Technology (6) Telecoms (30) Telephony (1) Transaction Support (1) Unified Comms (3) Valuation and fundraising (1) Social Media Our Blog Related Articles View all blog posts Acquisition Strategy, Blog Preparing for exit is key December 2, 2025 Acquisition Strategy, Blog Entrepreneurs’ Relief reform – the Evolution Capital take on
Entrepreneurs’ Relief reform – the Evolution Capital take on the 2020 budget
Home Contact Us Home-version 2 Service page About Us Office Location Post template Home Contact Us Home-version 2 Service page About Us Office Location Post template Entrepreneurs’ Relief reform – the Evolution Capital take on the 2020 budget Acquisition Strategy, Blog December 2, 2025 Yesterday’s budget signalled just how serious a threat to the British economy the coronavirus crisis has become. New chancellor Rishi Sunak’s announcement of the biggest budget giveaway for almost 30 years, including £12bn of immediate measures for the NHS, public services and small businesses in a coordinated move with the Bank of England, had to be funded by something and it seemed entrepreneurs were to pay the price. One of the most significant revenue raisers came from the decision to limit Entrepreneurs’ Relief, which Sunak described as “expensive, ineffective and unfair”. He said the lifetime limit would be reduced from £10m to £1m, a move that will raise £6bn. Paul Davies, M&A adviser at Evolution Capital, commented: “The reform to Entrepreneurs’ Relief was expected as the benefits fell to very few people. Indeed, for larger businesses, the relief has effectively been removed. From our research at Evolution Capital, we do not feel that there will be a material impact on business valuations at the point of sale. M&A activity in the TMT sector remains buoyant and we have a number of buyers who continue to be interested in acquiring high quality businesses with strong recurring revenues. Such businesses are still in short supply and remain attractive to potential purchasers.”The tax break had previously been heavily criticised by economic think tanks including the Institute for Fiscal Studies and the Resolution Foundation, who said it was not well targeted and caused distortions in the tax system. Entrepreneurs’ Relief, which halves the capital gains tax paid when people sell their businesses, was introduced by Gordon Brown’s Labour government in 2008 in a bid to incentivise people to create new businesses and was expanded by the Conservative government after 2010. However, it is said to benefit just 4,000 business owners a year, who tend to use the tax relief as a retirement pot, rather than stimulating new start-ups. It costs the Exchequer an estimated £2.7bn a year to operate without stimulating start-up business. Under Sunak’s revamp, the relief on capital gains tax when selling a business was significantly scaled back. Business sellers will pay 10% on lifetime gains of up to £1m, compared with the previous upper limit of £10m. Above £1m, business owners will be charged standard capital gains tax rates, which is 20% for higher-rate taxpayers.Sunak said fewer than one in 10 claimants said the relief had acted as an incentive to set up their business, and almost three-quarters of the cost went to 5,000 people. Indeed, it is said some 80% of small business owners would be unaffected by the change. The money raised by the Entrepreneurs’ Relief reform will be used towards other measures to help businesses, including an increase in the tax relief available for businesses investing in research and development, or buildings and structures. The employment allowance, which small businesses can apply for and put towards employer national insurance contributions and first introduced by George Osborne in 2014, will be increased by a third to £4,000.The tax reform was praised by Mike Cherry, the chairman of the Federation of Small Businesses as a “sensible compromise”. However, many business owners will find the decision a tough one to accept. Some argue there is a risk the reform will dis-incentive business owners to sell and would deny any reward for entrepreneurs who have taken risks and experienced hardship during the set-up phases of running their businesses. Miles Dean, head of international tax at Anderson Tax UK, claimed Entrepreneurs’ Relief was an “easy target” and that it sent out a negative message to people setting up new businesses.“Politicians must consider what this means commercially and what it will do for an economy that relies very heavily on entrepreneurs. It is a great shame. The message is loud and clear from this government: take all the risk you like in setting up a new business, it doesn’t count for anything,” he told Citywire.co.uk. Meanwhile, IPSE (the Association of Independent Professionals and the Self-Employed) welcomed Sunak’s “historic Coronavirus stimulus package” but criticised the government’s plans to extend the changes to IR35 to the private sector, claiming it would undermine the contracting sector. Chris Bryce, CEO of IPSE, said: “This Budget is a mixed but overall still gloomy event for most of the self-employed. The measures to support the self-employed and small businesses through the coronavirus outbreak are very welcome – and in-line with what IPSE has been calling for. However, just as the government tries to protect freelancers’ incomes with these measures, it destroys their work by forging ahead with the disastrous changes to IR35, despite heavy criticism.” Elsewhere across the business sector, the budget was broadly welcomed as a positive. Ian Stewart, chief economist at Deloitte, said: “Major shocks to economies need to be resisted with a swift, aggressive and co-ordinated policy response. Mark Carney and Rishi Sunak have produced a forceful and convincing response to the crisis. In economic policy terms, they just deployed the big bazooka.” Evolution Capital prides itself on offering bespoke M&A advice to clients in the TMT sector. Our carefully chosen tax experts are on hand throughout the transaction process to ensure all outcomes are as tax-efficient as possible. If you’re a business owner looking to buy, sell or accelerate, please get in touch with our transaction team. 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What I learnt – Tom Carroll, founder of Our IT
Home Contact Us Home-version 2 Service page About Us Office Location Post template Home Contact Us Home-version 2 Service page About Us Office Location Post template What I learnt – Tom Carroll, founder of Our IT Blog, IT December 2, 2025 In the first of our Evolution Capital Alumni series, we speak to Tom Carroll, founder of Our IT and an avid cyclist, about the lessons learnt following the sale of his business. Deal stories make headlines. As a sector we’re obsessed with what our rivals are doing; who is selling, who is buying, who the movers and shakers are. But what happens once the deal is done? What do entrepreneurs do once they have parted company with the business they have created, nurtured and grown? Two years on from the sale of ICT support firm Our IT, a business he built up over a period of 15 years, Tom Carroll is smiling. It is thanks to the advice from Evolution Capital, which paved the way for a successful exit back in February 2017, that Carroll has been able to fulfil his lifelong passion for cycling. “Financially the sale of the company was very rewarding and gave me plenty of time and choice for deciding my next move. The first thing I did was to cycle from Chile to Argentina which gave me lots of space for meditative thought. I then went on another cycling adventure from Lasa (India) to Kathmandu (Nepal) and then onto the Everest Base Station – traversing about 20 different mountains as I did so. When I came back I took intensive French lessons and then went on some more big trips – this time in Australia and the US. Thankfully, Carroll has now got rid of the wanderlust and is considering his next move. He remains on the hunt for businesses to buy. Looking back on the deal of his life, Carroll says there were numerous lessons learned and challenges met along the way, but ultimately the decision and subsequent execution of the company’s disposal was based more on serendipity than planning. He explains: “I had no plans to sell the business but I was highly active on the acquisition trail and had purchased and integrated a couple of businesses into Our IT. It was not until Evolution Capital approached me that I realistically considered selling the business. My one takeaway from this process is the time to transact is only when you have the right counter party in the room at the right time. Until that happens, the rest is just hot air.” He believes that in the increasingly frenetic M&A marketplace there are actually very few credible buyers. This might well explain the disproportionality between market activity and execution. Tom continues: “You can of course increase the chances of making something happen by doing the fundamental things well and presenting the company confidently, but most of the offers I received had little credibility and it made no sense to follow through with them. ”In hindsight, what were some of the unexpected bonuses learned on the way? Carroll continues: “Running and driving your own business is a lonely path to take. Like many owners in the same position, I did feel incredibly isolated at times. Of course employees and consultants, all with their own agenda, are always around but it was not until I joined The Supper Club that I discovered like-minded people. These business men and women were all under similar business pressures as me; the same HR, growth and cash flow issues that we face every day. It was comforting to learn and share similar experiences with my peer group. ”Many business owners, when they leave their companies behind, particularly those that have taken many decades to build and grow, feel a certain sense of loss when then finally decide to give the reins to another. Carroll explains: “Most people who dispose of businesses suffer some sort of sellers’ remorse. When you have created a thriving organisation, something that is not only a profitable business but one that has a flourishing spirit and ethos, it is hard to leave it all behind. One minute you are at the very centre, a self- determining, respected business leader who is looked upon for advice and guidance and the next you are not. It’s almost as if you are half the person you were, albeit with a much more healthy bank balance. ”One thing Carroll doesn’t miss is the stress. “I don’t miss the constant pressure of running a business or the trials and tribulations of driving a growing one. What I really don’t miss is the need to be in constant touch with the business and never being able to turn off. For the first time in years, I recently left my lap-top at home went I went on my holiday – contrast that with the panic I experienced when I forgot it on one vacation from Our IT.” Being an entrepreneur is certainly tough; even when the deal is done. Carroll recalls finding the so-called earn out period the least enjoyable part of being a seller of a business. “Although I was still there, managing the business and fully accountable, I was no longer in control. It was a sterile, semi existence and I completed it quick as I could – well within the allotted earn out period. I would advise others doing an earn-out to complete it as quickly as they can,” he explains. As someone who has lead and run a business for more than fifteen years Carroll has plenty of advice for entrepreneurs. “The one major lesson that I learned is that there is no silver bullet. All businesses are a sum of the parts, and owners need to make marginal gains in every area of their business to be successful. This is where Dave Brailsford’s Marginal Gains philosophy comes in – every company has to think like the British Cycling Team and try to apply small gains to