As we are going on week three of Wisconsin’s “Safer at Home” order, TKO Miller is busy at work, not missing a beat, however, things have definitely changed.
Rather than conducting our weekly deal meetings on Tuesday mornings, we are now meeting every morning using video conferencing, making sure that any issues popping up on the deals that we have in the market quickly get addressed. Communications with our clients are business as usual, with daily update calls.
Management Presentations Can Be Virtual
The one part of the M&A process where we have had to do something different is with management presentations and tours. These are a significant part of the M&A process where the buyer gets to see the facility and operations, and meet the management team, often for the first time.
In addition to the tour, the management team gives a presentation to the buyer talking about the business, its background, values, operations, sales, opportunities, and financial performance.
Since the Safer at Home order and social distancing is prohibiting in-person meetings, we are creating recorded management presentations that we share with qualified buyers. We are also creating virtual tours of the facilities and plants and utilizing video and drone technology. After buyers view the recorded presentation and tour, they engage with the seller and its management team on a virtual meeting where the buyer asks any follow-up questions and makes their pitch why they are the best suitable buyer.
While this is a new way of conducting management presentations and tours, this may be a method that will continue after the end of the COVID-19 crisis. Although the preparation of the presentation and filming of the virtual tour takes a lot of effort to create, the amount of time it saves the management team delivering the presentations is significant. We typically only invite the top 3-5 buyers in for a management presentation and tour, however, we can now invite the top 10 buyers, since the additional burden on the management team is minimal.
Another benefit is that the quality of the presentation and the performance of the management team are consistent and optimized; we can do retakes. Having each buyer hear and see the same story and performance is very beneficial when evaluating different buyers’ proposals.
The COVID-19 crisis has changed the world and the way business is conducted on a short-term basis and will most likely also change it in the long-run. While video and virtual meetings have been around for a long time, the current crisis has significantly increased its adaptation.
Just like how virtual data rooms changed M&A due diligence 15 years ago, it is now used by all participants in the industry. Virtual tours and meetings will continue to grow post COVID-19.