Business broker

They typically estimate the value of the business; advertise it for sale with or without disclosing its identity; handle the initial potential buyer interviews, discussions, and negotiations with prospective buyers; facilitate the progress of the due diligence investigation and generally assist with the business sale.

Investment banks, transaction advisors, corporate finance firms and others serve the middle market space for larger privately held companies as these transactions often involve mergers and acquisitions (M&A), recapitalizations, management buyouts and public offerings which require a different set of skills and, often, licensing from a regulatory body.

Some states also have statutes that define and control the nature of the representation and have specific business broker licensing requirements.

Dual agency occurs when the same brokerage represents both the seller and the buyer under written agreements.

However, although a business broker commonly does work such as creation of an information memorandum for a seller or completing the offer to purchase form on behalf of a buyer, agents are typically not given power of attorney to sign closing documents; the principals sign these documents.

All Canadian provinces with the exception of Alberta, require a real estate license in order to commence a career.

According to an IBBA convention seminar in 2000, at least 13 states required business brokers to have a real estate license.

The following states require a license to practice as a business broker: Arizona, California, Colorado,[3] Florida, Georgia, Idaho, Illinois (registration only), Minnesota, Nebraska, Nevada, Oregon (only if real estate transfer is part of the transaction),[4] Rhode Island, South Dakota, Utah, Wisconsin, and Wyoming.

Business brokers have a number of National, Regional and local Associations in the United States that provide education, regulatory and annual conferences for its members.