Angie Stocklin: Here’s what it looked like when we sold One Click

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My co-founder, Randy, and I started One Click in 2005 and sold the business to FGX International in 2018. In my previous column, I outlined the factors that drove our decision to sell the business. This week, I’ll outline what that process looked like for us.

A common phrase floating around the startup world is that companies are bought, not sold. I have no idea who said it first, but the phrase essentially means that if you build a strong enough business, someone will notice and knock on your door with an offer you can’t refuse.

Does this happen? It absolutely does! Is this the way we sold One Click? Absolutely not. This is what the process looked like for us.

Hiring exit partners

After we made the decision to sell One Click, we started talking to potential investment banking firms to find the right fit and chose the bank we thought would help us best maximize our exit multiple. This partner helped us create a list of potential buyers and handled communication and negotiations on our behalf. They also assisted us in creating documents, decks and presentations for potential acquirers, as well as filling out a data room for due diligence.

We also hired an attorney that specializes in mergers and acquisitions, and an accounting firm to do a complete audit of our business. Legal fees are often a hard pill for founders to stomach, but we would not have survived the process without their guidance, support and protection. The audit ensured there were no major gaps in our finances before we started down the path of due diligence. During the audit I learned that audit accountants never laugh at money jokes (regardless of how funny they are) and that inventory receipts (regardless of how small or old) are very important to keep. Luckily, the firm found no major concerns, and we moved forward with the process.

Trimming the list

Once our banking partner had a shorter list of interested buyers, the leadership team had calls to answer questions and move serious buyers to the next stage. Then, leadership teams from serious acquirers came to Indianapolis for in-depth, half-day meetings. These meetings were long and stressful but allowed our potential acquirers to learn more about the inner workings of One Click and allowed us to get a sense of why they were interested in purchasing us and their vision for our future.

Due diligence

Eventually, after two bid dates and evaluating our offers, we accepted an offer from FGX International and officially moved into the due diligence period. This is the period where the acquiring company dives deep into your finances, asks questions about your business processes and people, and essentially searches for any skeletons in your closets. Because of other M&A activity surrounding the company that owns Foster Grant, this process lasted six months. The length of time was incredibly stressful but also allowed us to visit both New York and Rhode Island to see Foster Grant’s operations in person and for us to get to know the leadership team of the company well before we closed.

Closing day

In July 2018, both sides were finally ready to sign on the dotted lines. We sat in our respective offices in our respective cities and signed paperwork that was scanned and digitally sent back and forth. After an 18-month exit process, this felt a little anticlimactic. There were no last-minute phone calls with heated conversations, and no “Fast and Furious”-type car chases or “Indiana Jones”-type rescues. It was just … suddenly over.

After the paperwork flurry was complete, it was time to announce the acquisition to our entire team. A few key members of the team had known for some time, and the rest of our broader leadership team found out about the probable acquisition a few weeks beforehand. But processing the rest of the team’s mix of shock, excitement, confusion and sadness during that meeting was something I will never forget.

After the all-company meeting, we broke into smaller groups to help team members process the news and get their questions answered. We were also able to share the news that the phantom equity plan we had set up a few years earlier was now triggered by the acquisition, and team members would receive a check with their portion of the selling price.

The next day, the FGXi leadership team came to our office in Indiana for another all-company meeting, followed by a casual afternoon that allowed our team members to get to know their new leadership team and vice versa. It was important to us that our new parent company had the chance to see our team members and our company culture in action.

In the next article, I’ll share what the after-sell process looked like for our team and what we learned along the way.•

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Stocklin is an angel investor and exited founder who currently teaches entrepreneurship at Purdue University.

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