Who Are Financial and Strategic Buyers?
Differences Between Financial and Strategic Buyers
Since they're approaching your business from a distance, financial buyers tend to focus purely on your company's ability to generate profits in a short amount of time. Strategic buyers, on the other hand, are more concerned with how the purchase will integrate with their existing business processes — for example, whether you have an overlapping customer base or whether you have trade secrets that they want to own.
Financial buyers need to evaluate not only the attractiveness of your company as an investment prospect, but also your industry's outlook and your company's position within the industry. Strategic buyers, however, are usually less concerned with the direction of your company's industry, often because they're in the same industry themselves.
Because financial buyers need your business to run as a standalone entity, they will be much more concerned with your organization's back-office infrastructure, including human resources, IT and accounting. However, strategic buyers usually have this infrastructure already in place and can disregard it during the negotiation process.