[EP 288] Behind the Deal: Business Broking, Buy-Side Strategy and Innovation – Part 1

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Joanna Oakey [00:00:00]:
Ladies and gentlemen, good evening.

Joanna Oakey [00:00:02]:
Are you ready?

Joanna Oakey [00:00:03]:
Okay, here we go.

Joanna Oakey [00:00:04]:
You’re listening to the Dealroom podcast. Join us as we bring you the inside scoop on business, sales and acquisitions. Get across trends in the area and hear the industries best recount their real life tips, traps and experiences. Now here’s your host, Joanna Okey. Hi.

Erin Crawford [00:00:25]:
Hi.

Joanna Oakey [00:00:25]:
It’s Joanna Oakey here. And welcome back to the Dealroom podcast.

Joanna Oakey [00:00:29]:
A podcast proudly brought to you by.

Joanna Oakey [00:00:31]:
A commercial legal practise aspect. Legal. Now, in this episode, I’m talking with a very impressive woman, Erin Crawford, from across our ocean, from the US, from the IBBA, which stands for the International Business Brokers association. And we are talking today about the us perspective on business, sales and acquisitions. Now, Erin has a lot of strings to her boat. She’s a certified business intermediary. I think that’s the word they use in the US for business broker with more than a decade of experience. She’s also on the IBBA board and in 2025 is actually the IBBA chairperson.

Joanna Oakey [00:01:16]:
So there you go. A very busy person. And amidst all of that, she also teaches at IBBA on business brokerage, market valuations and transactions. Anyway, Erin and I in this topic, some fantastically interesting topics ranging from the sell side to the buy side, the mindset of sellers and why trust is so important and how to negotiate effectively in business transactions. Now, you’ve probably heard conceptually some of these topics before, but what I think is particularly interesting in this discussion is the comparison between the australian and the us perspectives and processes. So anyway, let’s get into our discussion with Erin.

Joanna Oakey [00:02:02]:
Erin, welcome on board to the Dealroom podcast. It is an absolute pleasure to have you all the way from across the ocean. This is a bit exciting.

Erin Crawford [00:02:14]:
Thank you for having me.

Joanna Oakey [00:02:15]:
Wonderful.

Joanna Oakey [00:02:16]:
Okay. All right, so we’ve got loads of topics that I want to cover. When we were initially talking, there were just 100 things that I thought we could talk about. Why don’t we start with a bit of your background, like what you do just to grant, what are you doing right now and how did you get to where, to what you’re doing right now?

Erin Crawford [00:02:35]:
Sure. So I actually started in the business brokerage world working for a franchisor. Trans World business Brokers is their headquarters in West Palm Beaches, which is where I live. And so I was working for basically the franchisor of that brand in 2011 to 2014. And I was in charge of marketing and franchise development and discovered that I think I could have been pretty good at becoming at least an agent, if not a broker. Myself and I did not want to leave Florida. So Florida is the only state that you could not buy a franchise. So I ended up working as an agent underneath of Andy Cagnetta.

Erin Crawford [00:03:11]:
And he is, he’s a great mentor, a great leader that I worked under when I was with Trans World for many years. So I became a business broker in 2014. I earned my CVI credentials in 2017, and then I began teaching classes a lot for the BBF, which is the business brokers of Florida. And then I got involved heavily with the IBBA, developed courses, trained and taught courses as well, and then got more involved with conference planning and other things like that as well. Really just have grown my career and I now have my licences with a company, CII advisors, out of Florida. But I really work with one buying group and so I actually went from the sell side over to the buy side and that’s actually pretty difficult to do because most buyers only buy one business and now I’m working in the lower middle market and identifying transaction opportunities. Basically between the average between 3 million and 17 million is the range of the deal sizes that I’m currently acting as an intermediary for the buy side. That’s in a nutshell.

Joanna Oakey [00:04:15]:
And I want to talk about the IBBA and your involvement in the IBBA and how that runs. But before I do that, I just had a couple of things that it’s super interesting that I’d love to dig into a little bit more buy side brokers here in Australia. There’s not a lot of them here in Australia predominantly sell side. Is it the same in the US?

Erin Crawford [00:04:36]:
Exactly the same. Like I said, it’s just not usually a market. Most buyers, not necessarily that they’re all going to buy something and when they do, they often just buy one business. So it’s hard to stay with just the buy side. So I fortunately have teamed up with a buying group that is buying multiple companies, learning what they really have wanted over the years. I’ve been doing that now for four years and I’ve helped them buy 17 companies in four years. So it’s fun.

Joanna Oakey [00:05:04]:
I love it. What do you think? What’s been the benefit of moving to buy side as opposed to sell side? What was that pull for you?

Erin Crawford [00:05:12]:
I’m really managing a process. I learned a whole lot that if I ever got back into the sell side, I could actually take a lot of what I’ve learned and apply it on the other side. You really can learn the buying criteria of a group when you work hand in hand. And I understand what really, what makes a business more attractive and what doesn’t. And I’ve seen it in the due diligence side. We use a company for due diligence. I’m not really doing due diligence myself, but overseeing the process and then understanding the mental piece that a lot of times I don’t think brokers see that and don’t understand the connection that has to happen. Because yes, we’re in the deal business, but we’re also in the psychology business.

Erin Crawford [00:05:49]:
Personalities have to get along.

Joanna Oakey [00:05:54]:
That, yes, I love that.

Erin Crawford [00:05:56]:
Buyer and seller usually have to work together.

Joanna Oakey [00:06:00]:
Yeah, there’s a lot to unpack there. There’s a lot to unpack there. And I 100% agree with you. I actually, I also have a degree in psychology and I just actually find that even more useful than my legal degree. Although to be fair, I couldn’t be a lawyer, obviously without the legal degree. But, but it is all about the mental side. So unpacking what you said there step by step, why don’t we start with the mental piece? What is it that you’ve learned about the mental side now that you’re on buy side, you didn’t know.

Erin Crawford [00:06:31]:
When you’re on sell side, actions speak louder than words. And so a lot of times you can tell how people behave, what their true intentions are.

Joanna Oakey [00:06:38]:
Right.

Erin Crawford [00:06:38]:
We have contracts, we have legal, but when you start to see people start to behave differently, you can see where maybe they’re trying to hide things or I, it’s just not going to look like it’s going to be a good fit post closing too. And I think it’s super important. The purchase agreements and the documents leading up to our transaction are really short term. What really is long term are those transition agreements, seller consulting agreements, management contracts, things like that, that govern that relationship for a very long time. So making sure that everybody has equal skin in the game, but a dispersed amount of skin in the game in making sure that the business transitions, we’re selling future performance based on historical performance in most of the transactions.

Joanna Oakey [00:07:20]:
Right.

Erin Crawford [00:07:20]:
That’s why people buy businesses. How do we preserve that and how do we make sure that it’s somewhat fair? I love the old saying that says it’s the best deal when no one’s happy. Because every.

Joanna Oakey [00:07:37]:
If we can find a win.

Joanna Oakey [00:07:38]:
But yeah, that’s the other way of looking at it, isn’t it? I mean, it’s a really good point. We will quite often deal with sellers who, who just, it’s emotional game for them as well. They’ll get right to them and they’ll suddenly think, have I really got the best deal that’s sitting here on the market? Should I push it a little bit more? But the thing is, when you have sellers who push on everything constantly or buyers on the flip side, it just creates a really hard environment for that future relationship, I feel. That’s my opinion. Is that how you feel from the buy side? Is that the sort of things that you’re seeing that create issues?

Erin Crawford [00:08:16]:
I definitely. I’m going to take a saying that somebody else said, so. Not gonna take credit for it, but it was at the last conference, you can negotiate anything, but you can’t negotiate everything. So I love that. Yeah. So I just think that, you know, when you start to see, yes, they want a good deal, but it’s also good to direct a seller into making sure that the buyer is a good buyer, maybe somebody’s gonna overpay, but now they’re gonna go justify their transaction and get rid of half your staff. So is that really about protecting a legacy that’s been built up over time or is that just about a financial number or a strategic buyer having it just basically looking at it from only a paper perspective and not the human element of it? So I think that’s super important.

Joanna Oakey [00:09:01]:
And so is there any, when you’re talking, so you’re talking about the seller choosing the right buyer at the moment. Is there any coaching then that you give to your buyers or is this something you’ve learned through the, the behaviours that they already have?

Erin Crawford [00:09:18]:
I think I just learned throughout the whole process what is important to each party and figuring out where, hey, maybe we have a little bit of flexibility in this transaction on this aspect. Maybe it’s on working capital structure, maybe it’s on closing timelines. What’s super important for the person and where do we have room to negotiate? And where do we have no room to negotiate? Let’s put the deal breakers on the table first. If we can’t get past that, we’re dead in the water. So everybody’s going to waste time. Yeah, I think it’s just a process and every deal is different. I don’t think there’s any one thing that a buyer wants or the seller wants. I think it’s the personalities you have to get to know and become a resource to both.

Erin Crawford [00:09:56]:
They have to trust you. If they don’t trust you, not going to happen.

Joanna Oakey [00:10:02]:
Trust is critical, right? Absolutely critical. And really interesting that you talk about putting these deal breakers first, because one of the issues here in Australia probably the same in the US. I don’t know. There’s this issue. Brokers negotiated the deal, get the deal into contract and then they have this issue if they’ve got lawyers on both sides who are just wanting to nitpick through every single deal, every single component together. And one of the things that I say that I think is really important is that whether you’re acting for buyer or seller, that you clearly have an issues list, but then you prioritise it. So you have the most important things first and you have the rats and mice second. And I think that’s the reason why so many negotiations, once they get to legal phase here in Australia reach, have issues because lawyers don’t really have training here in how to run good negotiations.

Joanna Oakey [00:11:01]:
And I don’t know, business brokers may not either.

Joanna Oakey [00:11:04]:
Well, that’s it for this episode of the Dealroom podcast. We hope you’re now primed for your next deal with these pointers and have enjoyed these fascinating insights. Now, if you’d like more information about this topic, then head over to our [email protected], where you’ll be able to download a transcript of this episode as well as access any contact details and any other additional information we referred to in today’s podcast. Now, if you’d like to get in contact with our guests today and the services they offer, you can go ahead and cheque out our show notes for a link right through to them and their details. You can also book in directly with our legalegals at aspect legal. If you’d like to soundboard your next steps, discuss a legal question or find out more how we can assist, whether that’s with buying or selling a business, or perhaps somewhere in between. Now don’t forget to subscribe to the Dealroom podcast on your favourite podcast player to get notifications whenever a new episode is out. We’d also love to hear your feedback, so please leave us a review and rating.