IN THIS ISSUE:
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ISSUE
WINTER 2025
© M&A Source. All Rights Reserved. | The insights and opinions expressed herein are those of the authors and do not represent professional counsel nor an endorsement by M&A Source.
The Bridge
U P D AT E S & I N S I G H T S
F O R T H E L O W E R M I D D L E M A R K E T
A QUARTERLY PUBLICATION
OF THE M&A SOURCE
Chair’s Letter
An Interview with
M&A Source Member,
Sam Thompson
An Offer You Must
Refuse… to Make
The Importance of a Strong
Management Team When
Selling Your Business
Top 10 Tax Code Provisions Every
M&A Advisor Should Know
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NO.08
2 | T h e B r i d g e W i n t e r 2 0 2 5
Updates + Insights
for the Lower Middle Market
T h e B r i d g e | W i n t e r 2 0 2 5 | 3
Content.
NO.08
ISSUE
WINTER 2025
The Bridge
A QUARTERLY PUBLICATION
OF THE M&A SOURCE
Reflect on the successes in the past
year, look to the future of the M&A
Source and welcome our 2025 Chair,
Kathlene Thiel.
LETTER FROM THE 2024 CHAIR
04
Read personal insights into a career in
M&A with our latest member interview.
AN INTERVIEW WITH M&A
SOURCE MEMBER,
SAM THOMPSON
06
Get an overview of various provision
benefits and when they come into
play in M&A.
TOP 10 TAX CODE PROVISIONS
EVERY M&A ADVISOR SHOULD KNOW
14
Unpack what makes a “bad” opening
offer and learn when to stay silent.
AN OFFER YOU MUST REFUSE…
TO MAKE
08
Discover the impacts of having a strong team
behind your business sale.
THE IMPORTANCE OF A STRONG
MANAGEMENT TEAM WHEN
SELLING YOUR BUSINESS
10
4 | T h e B r i d g e W i n t e r 2 0 2 5
Chair’s Letter
As I pass the baton as M&A Source Chair,
I want to take a moment to reflect on
what a privilege it has been to serve this
extraordinary community of professionals
and to offer a heartfelt thank you to all the
members, volunteers, and staff of this great
organization. Over the past year, I have been
inspired by your dedication, collaboration, and
the shared commitment to excellence that
defines our organization.
What a Year!
When I first stepped into this role, I spoke about
fanning the flames of momentum built by those
who came before me. Thanks to all of you, those
flames have grown into a vibrant fire, illuminating
the path forward for M&A Source. Together, we
have achieved so much in 2024—from enhancing
member benefits and launching new educational
initiatives to hosting successful conferences that
connect and empower us as professionals.
While this is a moment of transition for me, it is
not an end but a continuation. The foundation we
have laid together fills me with optimism for what
lies ahead. As we welcome Kathlene Thiel as the
Chair of M&A Source for 2025, I am confident that
her leadership will bring fresh perspectives and
continued success to our organization. Kathlene’s
dedication and vision will ensure that M&A Source
continues to thrive and expand its impact in the
years to come.
As we look to the future, I encourage all of you
to remain engaged and take full advantage of
the incredible resources and relationships this
organization provides. Attend the conferences,
participate in the courses, and lean into the
network of peers who share your vision for
success in the lower middle market. The strength
of our community lies not only in what we achieve
individually but in the collective power of our
shared knowledge and experience.
Thank you for the trust you placed in me as your
Chair and for the unwavering support that has
made this past year so rewarding. It has been
an honor to serve, and I am deeply grateful for
the friendships, insights, and opportunities I have
gained along the way.
Let’s continue building on the successes we’ve
achieved and move forward with purpose and
pride. I am excited to remain part of this remarkable
community and look forward to seeing the great
things M&A Source will accomplish in the future
under Kathlene’s leadership. Onward and upward!
With deep appreciation,
Lamar Stanley
M&A Source 2024 Chair of the Board
Lamar Stanley
M&A Source 2024 Chair of the Board
As we welcome
Kathlene Thiel as
the Chair of M&A
Source for 2025, I am
confident that her
leadership will bring
fresh perspectives and
continued success to
our organization.
Kathlene’s dedication
and vision will ensure
that M&A Source
continues to thrive
and expand its impact
in the years to come.
T h e B r i d g e | W i n t e r 2 0 2 5 | 5
The Q4 2024 Market Pulse Survey
is open through January 15
Learn more and participate to gain access to
exclusive participant benefits.
GET STARTED
0%
10%
20%
30%
40%
Percentage Holding Off on Decisions Until After the Election
“We’re seeing a paradox here," said
Barbara Kline, CBB, Vice President,
Absolute Investment Realty. "While
client activity has spiked since the rate
cut, the election jitters are keeping
deals from fully materializing—there's
interest but also hesitation."
ELECTION JITTERS HAVE SELLERS HOLDING OFF AND BUYERS CAUTIOUS
Q3 2024 Highlights
80%
80%
Main Street Seller Market Sentiment Q3 2012-2024
LMM Seller Market Sentiment Q3 2012-2024
SELLER'S MARKET CONFIDENCE Q3 2012-2024
48%
MAIN STREET SELLERS
LMM SELLERS
MAIN STREET BUYERS
LMM BUYERS
38%
35%
28%
MARKET SEGMENTS STUDIED
MAIN STREET
LOWER MIDDLE MARKET
$1M-$2M
$5M-$50M
$500K-$1M
$2M-$5M
‹$500K
3,9
6 | T h e B r i d g e W i n t e r 2 0 2 5
Member Interview
Tell us about your pre-M&A career and how it
led you to doing this work?
My previous life has been in the hospitality
world. I founded and was owner operator of a
conference and event management company
for 29 years. As I grew the business I brought on
three partners. We found ourselves managing
various services for major events such as the
Final 4, US Open, Republican Convention, Super
Bowl and many large corporate and association
conventions. When managing events you are
always double and triple checking EVERYTHING.
We made sure to think through contingency
plans as Murphy’s Law prevailed...anything that
can go wrong will go wrong. This experience
has served me well as an M&A advisor. In 2010,
I started planning my career change. I first
worked on removing myself from my business.
My three partners were doing a great job in
their individual roles and once they knew I was
planning on leaving they were open to taking
on some of my duties. I also started attending
IBBA Conventions to learn more about the
transactions industry. I sold my shares back to
the business in 2012. When I left the business
was right around $16M in revenue with 150
employees. I immediately joined a Minneapolis
M&A firm and started my new career as an
M&A Advisor in 2013. I have found my previous
experience as a business owner has helped me
tremendously when advising business owners
that are ready to sell.
What personal characteristics and strengths
have supported your success in this industry?
I have Churchill’s quote, “Never, Never, Never
Give Up” in my office and I live by that. Having
owned a small business that was deeply
affected during 9/11 and the Great Recession I
learned how to maneuver through difficult times
and come out ahead when all seemed lost. This
attitude has helped as an M&A Advisor as most
transactions oftentimes need to be redirected
to get to the finish line.
What is your greatest M&A accomplishment?
This past year I was able to sell a business for
one of my clients at 89% above his expecting
price. Needless to say he was ecstatic. The
auction process I used was from a class I took
at M&A Source. I now use this same process on
all of my transactions and the results are always
at or above clients expectations.
With regard to the majority of your
engagements, do you work as a team or do you
handle things on your own?
I always have support help from my employees
yet almost all of my transactions I deal directly
with the business owner. We have two other
advisors in our firm and they deal directly with
their clients with support help too. On occasion
M&A advisors within our firm may team up
together.
Do you just do M&A or do you provide other
services – valuations, consulting, etc.?
We mainly offer M&A advising representing the
sellers. Many of our engagements will include
a valuation for fee, which we deduct from our
success fee at closing. There are situations
where just a valuation is needed yet that is a
very small percentage of our sales.
An Interview with
M&A Source Member,
Sam Thompson
Sam Thompson
M&AMI, CBI, Transitions in Business
T h e B r i d g e | W i n t e r 2 0 2 5 | 7
What is the biggest mistake you have made when
working on a deal?
I would say early on in my M&A Advising career I had
taken on a client that brought in the buyer. Because of
the previous relationship that the buyer and seller had
they were communicating at times without me. The seller
ended up agreeing to some aspects of the deal with the
buyer that they regretted. I quickly learned, no matter
what the situation, that I need to be in on all meetings and
calls with the buyer and seller.
What are the three most important qualities that you
think a good M&A advisor needs to have?
I would say patience is so important. I’m still learning
this. In my previous career once a client said let’s go to
contract, the meeting or conference usually happened
and our services were used. In M&A it never is a done deal
until all closing documents are signed and the money is in
the bank. Second would be to continue to learn the skill of
negotiating. Success in this industry comes to those that
can negotiate well. Third would be honesty. I’ve found if
you are truthful in everything you do people will trust you
and they will want to do business with you (as quoted by
Zig Ziglar).
What is your most interesting deal that you are working
on today?
I’m working on a manufacturing business with four
partners, three of which are not active and are doing
nothing for the business except costing the company
money. The active owner (my main client) has single-
handedly done amazing things with this business to get
it where it is financially succeeding. He’s the most honest
guy you’d ever want to meet and he’s interested in staying
on with the business (he’s in his 50’s). This business is, as
you may expect, drawing a lot of attention from buyers.
It’s one of those feel good stories when you see what this
one owner has done through hard work and determination.
It feels good to know I can help someone like this be
successful in an M&A transaction.
How long have you been an M&A Source member and
what do you get out of your membership?
I joined IBBA in 2010 when I still owned my event business.
I eventually started doing larger transactions and made
the decision to have membership with both IBBA and M&A
Source in 2016. By far the education that is offered by
M&A Source has tremendous value. I also find the people
at the conference are quality people and i enjoy the
networking.
As a seasoned M&A advisor, what changes and trends
do you see on the horizon that will impact on M&A?
I do think we may eventually see the Boomer Tsunami.
Where baby boomers that own businesses will have a
maximum exodus. This was the talk when I first became
an M&A advisor and the tsunami is yet to hit. I think a
main reason is baby boomers just like to work. Knowing
the youngest boomer will be 65 in 2030 I do think the
next 5-7 years will be very active with boomers deciding
it’s time to exit.
What advice would you give to new people entering the
profession?
It’s an exciting industry and stay grounded. Continue
to get as much M&A education as possible as you can
never know too much in this industry. The key is to be
networking constantly. I’m always fascinated at how a
certain connection, that I didn’t think would go anywhere
was the reason for a lead.
Please tell us something about yourself that has
nothing to do with your M&A career?
I have a wonderful wife of 36 years and three beautiful
daughters and a son-in-law. We have one grandson
that is two years old. Our family LOVES to travel and we
started a tradition last January to visit a warm climate
for a month in January (remember, we live in Minnesota).
The first destination was Costa Rica which is where our
photo was taken. We’ve yet to decide where we’ll go in
January of 2025. We have many ideas!
Sam Thompson
President/Owner, Transitions In Business
sthompson@transitionsib.com
8 | T h e B r i d g e W i n t e r 2 0 2 5
An Offer You Must Refuse…
to Make
THERE ARE MANY SITUATIONS IN BUSINESS NEGOTIATIONS WHERE A BUYER OR SELLER MUST
MAKE THE OPENING OFFER, EVEN THOUGH THEY MIGHT PREFER NOT TO. THERE ARE EFFECTIVE
TACTICS TO EMPLOY WHEN ONE IS FORCED TO MAKE THE OPENING OFFER, AND I COVER THOSE IN
SOME OF MY OTHER MATERIAL. BUT IN THIS ARTICLE, I’D LIKE TO TALK ABOUT THE OPENING OFFERS
YOU SHOULD NEVER MAKE. EVER. UNFORTUNATELY, MANY PEOPLE MAKE THESE KINDS OF OFFERS
EVERY DAY IN BUSINESS NEGOTIATIONS. AND THE RESULTS ARE TYPICALLY NOT POSITIVE.
These “bad” opening offers can come in a variety of
packages, but most can be grouped into what I call
Dummy Offers. There’s two reasons for the name. One,
the offers are not genuine, or serious, so they’re like
a dummy, or fake. Second, and more importantly, the
Dummy Offers are made by dummies, or people who
don’t know any better (but should). And how do I know
about Dummy Offers? Because I have been the dummy
making them, plenty of times, and believe me, the results
usually made me feel pretty dumb!
The first Dummy Offer is the “informal offer”. It goes like
this: the buyer is looking at the business for sale and is
talking and talking and casually mentions to the seller
what he thinks would be an appropriate price to pay.
Just an informal, off the record, comment. Right?
Wrong. While the buyer thought he was merely whetting
the appetite of the seller, to sort of “warm her up” to
where he was going to come in at, what he really did was
to set a base standard in the mind of the seller, a rock-
bottom limit to what the seller should take. Sellers seem
to have this innate sense so that whatever price they hear
from the mouth of the buyer, it is the lowest possible
amount the sale could possibly settle on.
In other words, in the seller’s mind the price negotiation
was heading only north from that point in the transaction.
This is done frequently by buyers. Of course, they never
intend to lock in a bottom price. But that is exactly what
happens. The “informal offer” is an uninformed offer,
and should never be made, unless it is par t of the plan
of the buyer for other reasons (but that is a different
subject altogether).
When you are in a business negotiation, you have
to consider everything you say to be something you
would write, because the opposing par ties don’t forget.
If it works to their advantage, they will remember it and
they will surely hold you to it later on.
Rhett Kniep
M&AMI, Centurion 7 Business Advisors
T h e B r i d g e | W i n t e r 2 0 2 5 | 9
Another Dummy Offer, often made in preliminary
business negotiations, is the “range offer”. Like the
informal offer, the range offer sets expectations in the
mind of the other par ty that are hard to break. I’ll share
an example:
A buyer is looking at a business to buy. The buyer
gets a meeting with the seller and in the course of
conversation, the seller asks her what she thinks the
business is wor th. The buyer, thinking that this is par t of
the normal process of arriving at a price blur ts out, “Oh,
in the range of 5 to 700 thousand.”
The buyer thinks she just told the seller she might be
willing to pay more, but hopes to get the business for
closer to $500,000. But it’s not what the seller heard. All
he heard was: “This business is wor th AT LEAST seven
hundred thousand dollars to her”.
Like the informal offer, the range offer aler ts the seller
to a price, and the seller’s expectations are set based on
what he hears the buyer say. The “range” offer doesn’t
really communicate an estimate of how much the
business is wor th; it communicates a number that is
either at the very top, or at the very bottom, and it
becomes the star ting point for all future negotiations.
This principle of Dummy Offers applies both ways.
The examples above illustrate misunderstandings by
sellers, but in the same way buyers can get the wrong
idea when a seller shares his or her mind prematurely.
Astute buyers and sellers recognize the learning and
implementing of effective negotiation skills involves
knowing when to be silent and when to share one’s
intentions with the other par ty. Doing it properly can
bring significant beneficial results, while ignoring it
might get you stuck with an offer you can’t refuse…
because you already made it.
Rhett Kniep
M&AMI, Centurion 7 Business Advisors
“When you are in a business negotiation, you have to
consider everything you say to be something you would
write, because the opposing parties don’t forget. If it
works to their advantage, they will remember it and
they will surely hold you to it later on.”
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1 0 | T h e B r i d g e W i n t e r 2 0 2 5
The Importance of a Strong
Management Team When Selling
Your Business
WHEN IT COMES TO SELLING A BUSINESS, MANY FACTORS INFLUENCE THE FINAL SALE PRICE AND
THE SUCCESS OF THE TRANSACTION. ONE CRITICAL ELEMENT THAT MAY OFTEN DETERMINE THE
ATTRACTIVENESS OF A BUSINESS TO POTENTIAL BUYERS IS THE STRENGTH AND STABILITY OF ITS
MANAGEMENT TEAM. AT TOUCHSTONE ADVISORS, WE RECOGNIZE THE PIVOTAL ROLE A COMPETENT
MANAGEMENT TEAM POTENTIALLY PLAYS IN THE SALE PROCESS. HERE’S WHY HAVING A STRONG
MANAGEMENT TEAM MAY BE BENEFICIAL WHEN SELLING YOUR BUSINESS.
By Steven Pappas
M&AMI, Touchstone Advisors