Psychological Readiness Drives Sales

Shaan Puri shares his experience selling multiple companies and emphasizes that psychological readiness and proper positioning are crucial for successfully selling a company. He contrasts the typical "Instagram-style" exits with more common scenarios where companies need to actively pursue a sale.

Key Points:

• Most Companies Are Sold, Not Bought

  • Unlike Instagram-style acquisitions, most companies need to actively work to get sold
  • The "great companies are bought, not sold" advice doesn't apply to most situations

• Psychological Readiness Assessment

  • Ask yourself four key questions:
    • Do you still believe this will work?
    • Do you still believe it will be big if it works?
    • Do you still believe you can do this?
    • Do you still want to do this more than anything else?

• Three Main Reasons to Sell:

  • Receiving a great offer
  • No longer believing in the business
  • Not wanting to run the business anymore

• Communication Strategy

  • Be selective about who you tell and when:
    • Discuss primarily with cofounders
    • Be careful with timing of telling employees
    • Create a communication timeline for different stakeholders

• Buyer Categories:

  • Unicorns (high-growth companies)
  • Dying dinosaurs (incumbents needing fresh blood)
  • Adjacent alligators (peers/competitors)
  • Talent farms (acquiring for talent)

• Key Roles in Acquisition:

  • Executive champion (main supporter)
  • Company router (facilitator)
  • Deal doula (advisor)

• Sales Process Strategy:

  • Run multiple conversations in parallel
  • Create urgency through competition
  • Package yourself as the solution to their specific problem
  • Do the work for them (prepare documentation, analysis)
  • Maintain momentum throughout the process

• Critical Rules:

  • "One choice is no choice" - need multiple potential buyers
  • "Deals fall through" - expect and prepare for failure
  • "Deal momentum is everything" - speed and follow-through matter
  • Don't burn bridges - rejected deals might come back