When selling to a PE firm, entrepreneurs must realize the buyer's unit of optimization is their entire portfolio, not the single acquired company. A PE firm acts as an asset manager allocating resources across investments. This means decisions about your former company will be made in the context of their broader portfolio performance.

Limited Partners (LPs) have become cynical about the overused term "proprietary deal." In response, private equity firms now use the term "direct" to describe deals sourced through their own relationships, outside of a formal auction process. This semantic shift is an attempt to sound more credible and avoid the eye-rolling that "proprietary" now elicits from investors.

The value creation journey begins with the end in mind. Private equity firms immediately consider who the eventual buyer will be—a strategic acquirer or another PE firm—and tailor their operational improvements to meet that future buyer's specific criteria and overcome their likely objections.

Most PE firms fail to stand out, resorting to generic claims like being "hands-on" or "caring about people." With more PE firms than McDonald's in the US, a truly unique value proposition articulated clearly is critical for attracting business owners and investors.

Instead of focusing on transactional details, Milliken's M&A lead connects with founders on an emotional level. By understanding their ultimate vision, he frames the acquisition as the fastest path to achieving their dream, a question that has proven highly compelling and effective in closing deals.

Lower-middle market sellers are often executing the only transaction of their lives and are unfamiliar with terms like "equity rollover." Buyers can build significant trust and create better deals by patiently explaining how these complex structures allow sellers to participate in the company's future upside.

Private equity firms leverage industry advisors for more than just expertise. A crucial, often overlooked role is to provide sellers, particularly founders, with a sense of security. The advisor vouches for the PE firm's reputation and intentions, which can be critical in getting a deal over the line.

To stand out from the flood of PE firms, acquirers must demonstrate deep operational knowledge specific to the seller's industry. Discussing granular details like inventory management, billing rates, and software challenges builds trust and proves you are a credible partner, not just a financier. This operator-led approach resonates with founders.

To build immediate trust and demonstrate value, QED partners engage with founders by simulating a board-level conversation from the first meeting. This "pretend I'm your investor" approach showcases their expertise and builds rapport, proving their founder-friendliness rather than just promising it.