Learn how to buy, scale, and exit IT businesses with insider tips from Rick Murphy of Cogent Growth Partners. Discover valuation insights, deal structuring secrets, due diligence strategies, and proven integration methods to ensure acquisition success.
Rick Murphy is the founder and CEO of Cogent Growth Partners, a firm specializing in buy-side M&A advisory for IT services companies. With nearly 30 years of experience, Rick has helped clients evaluate and acquire businesses through a process focused on real-world returns, relationship-building, and ethical deal-making. In this episode, Rick breaks down the truth behind “multiples,” what makes someone a qualified buyer or seller, why trust kills or closes deals, and how to handle integration post-acquisition the right way.
Whether you’re M&A-curious or actively planning a business acquisition, this conversation is packed with raw, behind-the-scenes insight into what actually makes a deal work.
00:00 Intro
02:10 What Cogent Growth Partners Actually Does
06:45 How They Source IT Companies Using CRM + Outreach
10:29 Why Most Sellers Don’t Know Their Numbers
11:51 The Truth About “Multiples” in M&A Deals
18:06 What Makes a Qualified Buyer
24:30 Red Flags in Seller Behavior
31:00 Why Trust Is the Cornerstone of Any Deal
35:00 How Culture and Employees Make or Break the Integration
43:10 Why Some M&A Deals Fail After the Letter of Intent
50:05 The Ideal Buyer and Seller Profiles
59:10 Stock vs. Asset Purchase: What Buyers Should Know
1:06:00 Step-by-Step Post-Acquisition Integration
1:07:00 How to Connect with Rick and Cogent
Website: cogentmergers.com
Email: [email protected]
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https://www.acquisitionscollective.biz/
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The video covers:
How Cogent Growth Partners leverages specialized marketing and outreach strategies to identify potential acquisition targets.
The critical importance of rigorous financial, operational, and cultural due diligence in successful acquisitions.
Insights into creating effective purchase agreements, including unique considerations for stock versus asset purchases.
Essential qualities of ideal buyers and sellers, including financial readiness, integrity, company culture, client base stability, and employee management.
Common pitfalls in acquisitions, such as overemphasis on EBITDA multiples without proper cash flow analysis.
The strategic advantage of engaging with sellers who are "M&A curious" but not yet represented by brokers, enabling clearer negotiations and smoother transitions.
Rick also emphasizes the critical nature of trust-building throughout the deal-making process, using the metaphor of dating to illustrate how successful acquisitions rely heavily on mutual transparency, respect, and clear communication. Additionally, he shares strategies for effective post-acquisition integration, focusing on employee retention, client onboarding, and strategic branding decisions to ensure smooth transitions and sustained business growth.
Whether you're a seasoned entrepreneur, an aspiring business buyer, or someone looking to scale strategically through acquisitions, Rick Murphy provides invaluable advice, practical examples, and proven strategies to enhance your acquisition success.
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