In Exit Strategies

An IOI and an LOI are not the same thing. An IOI is like asking someone on a date, while an LOI is closer to an engagement ring.

 

An indication of Interest (IOI) is a non-binding letter used to express interest in acquiring a business. The IOI will typically include a value range, due diligence plans, a high-level proposal for deal structure, and expectations for seller transition.

 

In 2018, we averaged four IOIs per lower middle market business sold. When you have multiple buyers at the table, the IOI allows you to weed out the tire kickers and focus your energy on the buyers who value your business and are the best fit for your exit goals. In the IOI stage, you’ll refine your buyer list, compare terms, and get an understanding of buyer intent.

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