Turning Down a Seven-Figure Offer

How We Decided Not to Sell Our Business

January 1, 2025 (An 8-minute read)

Late last Spring the wearies of the world were driving me down.

A daughter’s diagnosis, personal upheaval, a few rough spots for PowerCom, the energy PR firm I founded 22 years ago.

Tired.

No real vacation since… don’t know when.

Your typical business founder’s success burnout paradox.

Looking for an off-ramp. Or someone to help manage the load of a seven-figure business.

It was the balmy days of June, when an M&A agency gained our attention through a direct email and impressive website proposition.

Simple, creative, efficient, the agency suddenly had us considering listing the energy-PR firm we’d toiled to build.  

Things were looking different.

By July, we were listed. SBA Certified, too, for full buyer financing.

Wow! Validated and on the market!

The seven-figure non-negotiable price we would receive at closing wouldn’t buy an island, but it would be life changing.

A flurry of interest hit our data room. By mid-July, 42 potential buyers signed NDAs to learn more about PowerCom.

Briskly, we narrowed 42 to 10. A geographically and constitutionally diverse and impressive cadre of agencies!

“Could this really be happening?” we asked ourselves.

So, in August, rather than beachcationing, we plowed through scores of buyer-seller calls to narrow the field.

“How do you do what you do?”

“Explain more.”

“Are your numbers reliable?”

“What aren’t you telling us?”

Agency founders, CEOs, PR and M&A executives, devoting their time to play a corporate version of 20 Questions, attempting to uncover PowerCom’s secret sauce

We played it all straight as a laser. Total transparency. No reasonable question or data request was off limits.

We enthusiastically expressed our vision for how PowerCom can grow. How we could accelerate our catalytic effect on the progress of clean energy. Many of the suitors connected with our vision.

By late September we signed a Letter of Intent in response to a full-asking-price offer from a private equity-backed firm that emerged from the pack.

On PowerCom’s side of the ledger, the idea of adding additional corporate structure dedicated to core business functions like HR, Payroll, Accounting, Marketing, sounded attractive. It would enable us to do what we do best – focus on accelerating client success.

But what really dictated our choice to go with this potential buyer was the promise to build the PowerCom brand -- and the values it stands for -- consistent with our vision.

In October, we leapt into the sale/merger discussion, grinding through dozens of financial, and operational due diligence calls with the goal of a 2024 financial closing. The process involved opening our business kimono wide, and whenever the buyer asked.

The prospect of new partners and monetizing 22 years of sweat, grit, and determination to drive PowerCom’s next chapter, excited and energized us. We determined not to miss a beat with any ask during the process. 

A flaming curveball came flying in the first Saturday of October, when we received a late-night text that my oldest, dearest friend, Brian Coughlin, died earlier that day in an airplane crash at the Olde Rhinebeck Aerodrome in New York’s Hudson Valley. It was devastating. A huge hole through the middle of my heart like buckshot. Unbearable.

Brian’s death was a massive blow. I took time for memorial services at his home in Cazenovia and the Aerodrome, before returning to the intense work of M&A.

November rapidly approaching, knee deep in the process, you really start to think about all the consequences of such a deal. Who will be impacted? How will it affect them? What should we do?

We’ve always operated PowerCom with a bedrock core principle: Strive to lift ALL people with whom we interact.

Rather focusing solely on profit, we strive to improve the lives of those with whom we interact. Whether on a personal level, as with our employees, contractors, clients, and business counterparties, many of whom are also dear friends, or, on a macro-level, by driving change to create a cleaner environment and economic uplift for the communities we touch.

If you know your true north is improving lives for people at every interaction—even as simply as with a smile and upbeat manner—then decisions become easier.

Not to imply that the prospect of selling PowerCom was at all easy. It was grueling. On the one side of the ledger, you have this big pile of money within your grasp. With it, you can pay off debt, travel, cut back work, and maybe even do some frivolous spending.

On the other side of the ledger is autonomy -- the unconstrained ability to run the business as you want -- with the values you want. If you want to close it down tomorrow, you can. If you want to change your mission, we can start selling donuts. Sounds esoteric, but it’s not.

As we progressed through Thanksgiving, and crept toward the finish line, every interaction, decision, glance takes on greater import. How will this impact our clients? Our people? Our mission?

The process of accounting for the impact of the sale on every point of contact created an unintended consequence. It highlighted -- in blazing focus -- how very fortunate we are. How the caliber of our connections and interactions are precious and worth preserving. Something that’s always been there and enjoyed, but subconsciously.

The due diligence process affirmed this aspect of PowerCom, and how it enhances all we do. Perhaps Brian’s untimely death had something to do with making the people a priority as well. Death has a way of doing that.

At the same time, I was reminded that all buyers have tells—just like in poker. What I was picking up from this buyer began to concern me. Repeated assertions that meetings will happen, documents will be provided, and other essential steps in the process that just didn’t get done.

What seem like simple missteps get magnified when projected against the backdrop of the rich and abiding business and personal relationships we enjoy. At PowerCom, when we tell you something will get done, it gets done. Our clients expect it.

The coup de grâce for the deal, however, came as so many things do, hidden in an innocuous conversation. We were on a call to wind up the due diligence process and one of the buyer’s management team was assessing PowerCom staff responsibilities when he asked about a particular client.

“Do you think that client is happy with your work?”

“Yes, I think they’re very pleased,” I answered.

“Then, we don’t need to do anything else for them and can shift this resource elsewhere.”

“Excuse me??!!” I screamed in my head. “What…??? Is this how you view client service???”

Instantly, in a quantum computing millisecond, it all crystalized for me. The way these guys could afford to write us a big check was to suck all the value out of the relationships we’d worked so hard to build over 22 years -- our client relationships, our employee rapport, our contractor connections. Everyone and everything was a target for post-closing value liposuction.

“No way!! Done! Finished! Over!” I silently yelled to myself, while outwardly maintaining call decorum.

Our management team met later that day and concurred.

“Deal is over. We all value what we created way too much to have it stripped to the bones. Maybe we won’t get an ‘A’ at Wharton, but it sure feels good sleeping at night,” was our overriding reaction.

The next day, in mid-December, we called a meeting with the buyer’s CEO to deliver the news directly. Nice guy, very charming. Been involved with various business deals. Lives in Hollywood with an influencer spouse.

Promised in-person meetings multiple times on which he could never deliver. My impression going into this call was that he thought he was going to leverage it to “close” me, so the deal could get done by end of year. What he didn’t know, was that we had decided and there was no way this was happening.

Per course, his assistant reached out at 1:58 p.m. for the scheduled 2:00 p.m. call.

“He’s running late. Can you stand by until 2:30.?” she emailed.

“Touché’,” I thought, “You reinforce our decision at every step.”

“Sure.” I replied.

As soon as we assembled at 2:30 p.m. I was direct.

“Look,” I said before he could get into it, “We won’t be proceeding with the deal.”

He looked like a frying pan had hit him in the forehead.

His eyes told me he was having difficulty processing.

“And given the circumstances, we ask you release us from any further obligation stemming from our Letter of Intent,” I added.

I stopped speaking and let that hang there.

After a few moments of stunned silence, he gathered himself.

“Can I ask why?” he ventured, clearly still struggling to process.

“Just not a good fit,” I said, attempting politeness.

In the weeks up to that point, we were getting increasingly frazzled. The dissonance between the lure of a big payday and doing what your gut tells you is right can induce major tension. Laying in bed at night, staring sleeplessly into the ceiling, you keep projecting into a future and all the things you’ll do once the deal is done.

Like a spoonful of some home remedy, it’s like trying to swallow what your gut is telling you isn’t right.

It wasn’t right because of the lack of follow through,

the lack of respect for people and their time,

But most of all because it was inconsistent with what we’ve built at PowerCom.

Once the decision was made to nix the deal, everything felt right again. Better than right in fact.

The sense of calm and abiding once we determined to end the deal was profound.

We felt grateful for the resolution of the dissonance.

We felt thankful for the dozens of outstanding peers whom we’ve met, learned from during this process, and who have validated PowerCom’s unique value proposition.

But most of all, we felt a profound sense of gratitude for the people with whom we interact every day. The process reminded us of what an incredible, warm, diverse, creative, talented cadre of professionals operate in our orbit.  

In the early days of the New Year, post-deal, we are looking ahead with great optimism.

Until now, we shared this journey with no one in our lives, except my wise father Ted Sullivan. This was done intentionally to save those around us the concern about an uncertain future. Until it was one we knew would serve everyone well, and PowerCom’s mission, no sense in worrying anyone. This deal did not.

That said, completing the intensive sales due diligence has uplifted, energized, and made us more optimistic than ever about PowerCom’s future. That cloud of malaise from June is gone and in its place is a clear, focused plasma beam illuminating the steps ahead.

The process validated the unique, energy-focused PR firm we launched in 2003 is well run, enjoys a rich and diverse mix of platinum-level clientele for which PowerCom consistently produces profitable outcomes.

We were also able to identify the people, processes, and initiatives to put in place to grow and scale to provide the increasing impact we envision -- but doing it our way. With people at the center.

Today, we are excited about the future and turning learnings from our journey into the next phase of growth for PowerCom in 2025.

Today, we won’t be selling.

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Steven C. Sullivan is the Founder and CEO of Power Communications, an internationally recognized public relations firm serving the global energy industry for over 21 years. Sullivan@powerny.com.