Selling a company is often about more than hard facts and figures. At the end of the day, buyers and sellers are people; as such, every deal has a “human side.” Given that, there are many times when the “art of the deal” is a nuanced affair, requiring finesse rather than brute force. No two transactions are ever the same; neither are the buyers and sellers involved in the deal. That said, there are certain elements of every transaction that require both parties to be mindful that a little of that human touch goes a long way toward ensuring a successful closing. Here are 10 characteristics of the “human side” of a deal, in no particular order:

#1 Momentum: It is critical for all parties involved in a transaction to work toward a successful transaction, and momentum is an important part of that. Ideally, all parties maintain the same commitment and the same intensity from beginning to end. However, transactions can lose momentum in subtle ways, such as failure of the seller to respond to information requests in a timely fashion (hours, not days or weeks), failure to return phone calls, or subtly infusing doubt about the seller’s commitment to follow-through on the sale – leaving the buyer wondering about the seller’s commitment to the transaction. If this happens, it can definitely slow, and possibly derail, a transaction, as the buyer now feels less urgency to fulfill their commitments in a timely fashion — and so momentum gradually erodes. So it is important for everyone to stay “pumped” about and dedicated to the deal from the initial meeting until the last “wire clears.”

#2 The “trust factor:” Bottom line, if the buyer or the seller (or both) does not trust the person on the other side of the negotiating table, they probably should not be doing business together. It can be hard to quantify trust, but we always say, “a deal that cannot be done on the basis of a handshake probably should not be done at all.” That said, it does not matter what is put “in writing;” if there is mistrust between the parties, it will be difficult, if not impossible, to engineer a successful transaction. It also begs the question why anyone would want to do a deal with someone that they do not trust, other than out of sheer desperation.

#3 Buyers’ past experiences: Although every deal is different, buyers almost always bring their past experiences and biases to the table. Once a buyer has been burned on something in the past, like a specific item in due diligence, that diligence item will become SOP in every future transaction. It is important to note that buyers’ diligence lists only get longer as the cumulative results of their past experiences add up. If a diligence item is important to the buyer, the seller will have to respond to the topic if they want to sell their company to that buyer, no matter how off-base or unreasonable the request may appear.

#4 Perception: Dovetailing with buyers’ past experiences, sellers also need to be mindful that a buyer’s perception is reality, regardless of what the real “reality” may be. If a buyer has a bad feeling about a company, whether it is accurate or not, that is their reality. In other words, if a buyer has a perception about an industry or type of business, it is near-impossible for them to “get over it.” Again, if a buyer’s perception does not match the reality, the best outcome for a seller is to accept it, cut their losses, and move on.

#5 Emotions: The sale or purchase of a company can be an emotionally charged experience for all parties involved. Therefore, it is important for the parties to manage their emotions to the best of their ability, and try not to overreact or say things in the heat of the moment — during a tough negotiation, for example — that they might regret later, or that could cause the deal to fall apart. As one of our clients says, “Never miss an opportunity to keep your mouth shut.” Wise words, indeed.

#6 Recognizing when a buyer needs to do a deal: There are specific times when it is necessary for a buyer to purchase a company: they must make the acquisition for strategic reasons, or perhaps it is a private equity group (PEG) that has un-invested capital commitments near the end of their fund investment life or the PEG needs to do their first deal. Sellers who recognize these opportunities can use them to their benefit.

#7 Patience: When selling a business, there are times when it pays to be patient (sometimes literally), and times when it is necessary to put the pedal to the proverbial metal. However, sellers must “pick their moments” and recognize when patience is a virtue (letting the deal come to them) or a vice (not forcing the issue when doing so would rightfully accelerate the process or flush out an important matter).

#8 Trusting the process: That said, entrepreneurs generally do not have a reputation for being the most patient bunch. However, it is important to understand that sometimes it is necessary to “trust the process,” let go of the reigns and let a transaction play out – within appropriate guard rails – based on a well-conceived and executed sale strategy.

#9 Understanding the difference between innovation and selling a business: In addition, owners need to understand the difference between their ability to invent and their capability to sell a company. Each requires different skill sets. In other words, just because a business owner possesses the ingenuity to innovate, those skills do not necessarily translate to selling a business. As such, sellers may benefit from consulting with outside experts who have the skills and experience necessary to help them navigate through the deal process, i.e., attorneys, accountants, investment bankers, business advisors, etc.

#10 Finding buyers who have previously made money in the same space or industry: For a seller, this is like striking gold. A buyer who has completed a successful transaction, or several transactions, in the space before is more likely to be positively predisposed to the new acquisition opportunity. Buyers want to make money in areas where they have made money before. However, the reverse is also true: buyers who have been burned previously in a particular space are more likely to give a wide berth to a company operating in that space.

When it comes to dealing with the “human side” of a sale, it is important for sellers to keep all of these characteristics in mind. When people and their unique personalities are involved — and there is no escaping that with multiple parties on both sides of the negotiating table — it is impossible to control or anticipate every aspect of a transaction. Often, it is necessary to take those unanticipated aspects in stride and deal with them as they come about. Sellers who can recognize and “roll with” these 10 human elements while keeping their cool and trusting in the process have a high likelihood of getting to a successful closing that achieves their objectives (with a lot less aggravation).