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Have you ever wondered why two identical businesses can sell for vastly different prices? One owner walks away with generational wealth, while the other settles for a steep discount and “unattractive” terms.
In this episode of The Exit, Steve McGarry sits down with Cameron Bishop, the Managing Director at Raincatcher, to pull back the curtain on the high-stakes world of M&A. From his humble beginnings as an advertising copywriter to scaling a company to $400 million with 2,000 employees, Cameron has been in the driver’s seat of over 90 buy-side and sell-side deals.
Today, he’s sharing the tactical “cheat sheet” every founder needs to maximize their valuation and avoid the mistakes that kill deals in diligence.
Why Most Founders Leave Millions on the Table
Cameron’s “unusual” background gives him a unique perspective. Having spent half a billion dollars in private equity money, he’s seen the “hair” on deals from the buyer’s perspective.
“When I was on the buy side, I could see ways that if they had properly packaged and prepared their company for sale, I would have had to pay them anywhere from hundreds of thousands to millions of dollars more.” – Cameron Bishop on why founders can lose out in an exit.
The tragedy? Most business owners are so busy working in their company (95% of the time) that they spend almost no time working on it.
3 Red Flags That Kill Your Valuation
According to Cameron, these are the “automatic outs” for buyers:
- Owner Dependency (The “Vacation Test”): If you haven’t taken a vacation in years because the “wheels will fall off” without you, your business is a risk, not an asset. A truly sellable business is one where the owner isn’t the key relationship holder or the only source of expertise.
- The “Cash Basis” Trap: Most private companies run on a cash basis for taxes, but professional buyers and banks want to see GAAP accrual financials. Cameron recommends converting your reporting at least 1–2 years before selling.
- The “Distressed” Look: Deciding to sell only when the business starts declining is a recipe for a “steep discount.”
The “Fish and Chip” Method: Protecting Your Deal
Buyers often “fish” with a high enterprise value and then “chip” away at it during the Letter of Intent (LOI) stage—a process known as retrading.
To defend yourself, Cameron advocates for Sell-Side Diligence. By gathering 100+ data points and vetting your own business before going to market, you can get ahead of hiccups and negotiate from a position of strength.
How to Get $9 Million More Than Your Valuation
In one of the most exciting segments of the interview, Cameron reveals how he took a company valued at $19 million and sold it for $28 million. The secret? Creating a competitive bidding environment and understanding the mentality of private equity “roll-ups.”
