Let’s face it, cold calling CEOs is tough.
Some advisors avoid it altogether and simply send mailings. Sound familiar? While sending letters may be the easier route, there’s nothing quite as powerful as getting a live, captive audience to hear you out.
In order for it to be successful, you need to go into the call with a fully equipped tool belt and be ready for all scenarios. Here are the essentials for your CEO cold calling toolbelt:
1. Fast Facts About Their Company
The time you spend before you pick up the phone is more valuable than any salesy speech you can spew out on the call. Do your research, avoid talking too much about what you have to sell, and focus on them. Ask about their specific challenges in order to frame your services in a way that makes most sense for their needs. Unless you give them a reason to listen, they’re suddenly “running into a meeting” and need to hang up.
Do your homework. Spend some time on their website, learn what they’ve been up to, read any recent press coverage. Dale Carnegie once said, “You can make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you.”
2. Industry Know-How
Generalists are becoming more and more a thing of the past, as CEOs prefer to work with someone with industry knowledge. If you don’t know much about a particular industry, pick up the phone and call a firm that makes acquisitions solely in that sector. Many advisors are surprised to find that firms are happy to have these conversations, even prior to a signed engagement. They see it as proprietary deal flow. Talk to them about every aspect of the industry — day to day responsibilities, pain points, lingo, typical margins and multiples. The better you understand the industry, the better prepared you’ll be to talk about the business the CEO holds closely.
3. Shortlist of Buyers
Prior to the call, build out a short buyer list targeted for this particular company in this particular industry. Dropping a couple names of relevant buyers on the call is sure to help catch their interest. CEOs receive calls all the time about advisors promising that they can sell their business. Coming prepared with a few strategics or family offices will make them more willing to sign an exclusive with you.
4. Trojan Horse
You will be hard pressed to get a CEO on the phone without first going through a gatekeeper — likely a secretary or executive assistant. Their job is to keep the CEO off the phone, so you need to be quick on your feet. Make your opening statement as strong as possible. Explain to them exactly why the CEO needs to take this call (this may be where you can reference one of the buyers you have prepared). Your goal is to get past them as quickly as possible, so don’t be afraid to use a little bait and switch. Once you’re past the guard, you can fully reveal yourself.
Do you have a script prepared for the call? Great, now shred it.
“Most people do not listen with the intent to understand; they listen with the intent to reply,” according to Stephen Covey, author of The 7 Habits of Highly Effective People: Powerful Lessons in Personal Change. Everyone finds themselves guilty of this at one time or another. We’re all busy and have goals we need to hit and places we need to be, but that’s all the more reason to be authentic. Listen first, then reply.
Don’t interrupt. Don’t be thinking about your next angle while they’re telling you about their business model. Don’t multitask and reply to emails while they’re explaining their fears about selling. Make them believe that they are the one and only call you’re going to make today. Make a connection with them not only as a potential client, but as a fellow human being.
6. A Plan B
Thomas Edison famously said, “When you have exhausted all possibilities, remember this — you haven’t.” When cold calling a CEO, you never know exactly how the conversation will go. You need a backup plan in case things don’t go as planned.
If a CEO emphatically isn’t ready to sell, talk to them about their timeline. Ask them if they’ve ever thought about selling and when they envision possibly exiting their business. If they say 2-3 years from now, ask them what steps they’re currently taking to prepare; some business owners might not be aware how long the process takes. As the Godfather put it, “Offer him a deal he can’t refuse” — or at least ask him at what threshold he would consider selling. Prove your expertise with specific tombstones. Explain — in as specific terms as possible without betraying confidentiality agreements — exactly how and to what extent you’ve been able to generate higher multiples than industry standards.
But don’t push too hard. Offer to share relevant content or helpful resources for the CEO to peruse, and to keep in touch. You can continue to pass along relevant buyers in hopes that the CEO bites.