Is asking for "Proof of Funds" Normal?

June 05, 2022
by a searcher from Anderson University in Raleigh, NC, USA
It is NOT normal for truly experienced business brokers. Selling a business is not that black and white. This hurts the seller, who will most likely never sell their business.
The broker who asks for "proof of funds" is just trying to cash out. In most of their NDA's they state that they have not even verified the business data. When they ask me for "proof of funds", I ask for "Proof of Financial Data."
Really, I just move on to the next acquisition target. Remember, there are plenty of small businesses you can ethically acquire without a broker and let the seller keep that broker fee they would have paid.
from Boise State University in 800 W Main St, Boise, ID 83702, USA
from New York University in Menlo Park, CA, USA
Real buyers gladly share information regarding their financial ability to get a deal done.
Real buyers clearly articulate why they are interested in a specific opportunity.
Real buyers share their email and telephone number.
Real buyers share their company website and LinkedIn profile.
If I sense you are trying to evaluate my client through a one-way mirror, I won't waste my time with you and certainly won't waste my client's time with an introduction.
Just like buyers should be asking "Why are you selling?", sellers should be asking "Who are you and why are you interested?"