An integrated awareness campaign, created to identify why so few girls are pursuing careers in IT, generates substantial brand power for CompTIA.
Read the Case Story
|Good PR leads to company acquisition inquiries and higher valuations.|
The goal of most company founders, owners and investors is ultimately to have a liquidity event that rewards key stakeholders for their role in creating a successful company.
For example, if you've built up a great tech company over the years through brains, hard work and perseverance, odds are you'd love to be acquired by a big company that will pay a handsome premium for your firm.
With my first tech startup company that I co-founded, we were able to sell the company for $10.5 million one year after getting a $750K venture capital round. I can assure you that the day the transaction closed was a glorious day for all of us who had worked tirelessly to build that software product and bring it to market.
Sadly, many good companies never reach that milestone event, but few understand that one of the key drivers of their failure was that they consistently underinvested in PR.
That's right. Underinvesting in PR can lead your business to not be acquired. Moreover, if you do manage to get acquired without having had good PR, odds are you are leaving money on the table that would have been there if you had done a better job in promoting your company.
Why PR Helps You to Get Acquired
Prior to writing this, I called up a few of my contacts that work in investment banking and corporate acquisitions and asked them this simple question: How do you find corporate acquisition targets?
Here are some things they mentioned:
In other words, with the exception of the last item, potential acquirers of your company are finding out about you through your marketing and PR.
But if they don't hear about you, if they don't know that you exist, what do you think the odds are that they will want to acquire you? Close to zero, I'd say.
The blinding glimpse of the obvious here is that if you want to get acquired, invest in PR.
Invest even more in PR as you enter the final 24 months when you are packaging the company up for sale. Each media placement or analyst mention you get is a hook in the water that might catch the eye of a potential buyer.
The call starts something like this: "We saw your company mentioned again today in The Wall Street Journal. It seems like you are getting a lot of attention and we thought it might make sense to meet to discuss some strategic partnering options."
Play your cards right and you can turn that call into a signed Letter of Intent to buy your company for a sweet price.
Of course, an even better scenario is if you are mentioned in the media and get multiple calls like that one. After all, the best way to get a high exit valuation for your company is to have multiple bidders competing to buy you. While it's true that hiring an investment banker or business broker can help with that, we've seen good PR also be a driver of getting multiple buyers to the table.
It makes sense. The better you are known, the more people who are likely to want to buy you. In contrast, if you keep a low profile and stay in stealth mode, just keeping your customers happy, nobody is going to make you an offer.
PR has always been a great way to build credibility. A positive mention in the press is an endorsement from a credible third party that says you are the real deal, not a pretender. Other outputs of PR -- such as appearing in analyst reports, winning industry awards, or getting a speaking opportunity on a panel at an industry conference -- also convey that you are a player and put your company name in front of potential acquirers.
PR works because it's not you saying "I'm great" -- which sounds a bit self-serving; instead, it's a respected outsider saying "They are great," which is much more convincing.
That credibility and visibility is great for attracting customers, but it's just as great for attracting investors and acquirers.
The last thing I will add is that in addition to PR helping you to get acquired and to getting multiple bidders to the table, PR will get you a higher valuation price for the exit. If you've won a prestigious media award or industry accolade, tack on one or two million dollars to your sale price. Featured multiple times in major business media outlets and industry trade publications? Add a few more million to your selling price.
The acclaim you have built around your company has a value to it, and acquirers will pay extra for that value. Trust me.
This isn't theory. It works. One company we represented sold for over $100 million after we had worked on their PR. The CEO responded to my congratulatory note by telling me that we had played a big role in their success.
They were acquired by the second largest company in their industry, one of two 8000-lb gorillas in their space. A specific goal of the PR program had been to get them mentioned in articles that mentioned the top two players in their industry. I'm convinced that the CEO of the acquiring company kept seeing their name in the press and finally decided: I've got to buy this company before my arch competitor does.
By the way, we normally don't mention our client's competitors when we pitch them to the media, except in two instances. One of those instances is when the company is interested in being acquired by a larger competitor. (The other is when a smaller company is competing against a couple of giants and wants to be mentioned whenever those giants are mentioned in order to steal some of their market share.)
So what are you waiting for? If you want to sell your company within the next two years, the day to hire a good PR firm was yesterday. If you are a tech company that has a track record of success, we are here to help you get across that all-important finish line. Get in touch for an initial conversation and it could be the first step toward achieving that big company sale you've been dreaming of.
Read the Case Story
Read the Case Story
Nearly all B2B brands (98 percent) finally recognize that content’s performance…
2018 was a big year for marketers. GDPR implementation came and…
Leads make or break your business. But generating leads isn’t as…