The first owner call: what to ask before an IOI or LOI

The first owner call should help both sides decide whether another conversation is worth having. You need to understand the business and the seller's expectations. The owner needs to understand who you are, how you would approach ownership and what you would need to evaluate a transaction.

Prepare enough to ask specific questions, then leave room for the answers. Reading a diligence checklist aloud can obscure the most useful part of the call: how the owner describes the work, the people and the reason for considering a sale.

Agree on the purpose and process

For a broker-represented business, coordinate through the broker. Confirm who will attend, the time available and what the seller expects to discuss. Ask whether financial questions belong in this meeting or in a separate follow-up. Respect the broker's instructions about subsequent contact.

For a proprietary conversation, first establish whether the owner wants to discuss a possible transaction at all. An introduction or response to an outreach email does not establish sale intent. Ask what would make the conversation useful for them and agree on how sensitive information will be handled before requesting it.

Review the confidentiality agreement and process instructions with your advisors where needed. Confirm permitted recipients before circulating materials. Do not contact employees, customers or suppliers without an agreed process and authorization. The guide to forwarding a passed deal covers questions to resolve before introducing another buyer or sharing information if you later pass.

Prepare a short question sheet

Read the CIM, your screening notes and the correspondence leading to the introduction. Revisit your search fund buy box so you can distinguish a firm constraint from something you merely prefer. Mark questions the documents already answer and questions where the owner's explanation could change your decision.

For each priority question, note why it matters. If you cannot relocate, the need for daily on-site supervision matters immediately. If the seller owns the principal customer relationships, the transition deserves more time than a general industry discussion.

Prepare a brief introduction about your background, intended operating role and acquisition process. Be accurate about your financing position and experience. Explain what you can assess now and what requires lender, investor or advisor work. Avoid implying that you can commit to price or timing before completing that work.

Share a short agenda through the agreed contact. You might propose discussing the owner's goals, a typical operating week and the main questions from your document review. Keep the longer request list for follow-up.

Ask why the owner is considering a sale now

Begin with the owner's account of the business. Ask what they are proud of, what has changed and what prompted the decision to explore a sale. Then ask what they want the next phase of their life to look like.

Useful questions include:

What would a good outcome from a sale look like for you?
Why does this feel like the right time to consider it?
Are there dates or personal commitments that affect your timing?
What involvement would you want after closing, and for how long?
Who else needs to be involved in deciding whether to sell?

Listen for expectations that need clarification. Wanting to retire soon and offering a long transition may describe a flexible seller, or it may mean the transition role has not been defined. Ask what that involvement would look like week by week before interpreting it as a commitment.

Leave room for questions about you. The owner may care about employee continuity, the company's name or their own future responsibilities. Record those priorities without promising outcomes you cannot yet support.

Understand the work the owner performs

Ask the owner to walk through a recent working week. Follow the work from new business through delivery, billing and collection. Find out which decisions reach the owner and which the team handles independently.

"Who runs operations?" can produce a job title without explaining responsibilities. Ask who schedules work when there is a shortage, handles a customer complaint, approves a quote or resolves a supplier problem. Ask what stops when the owner takes time away.

Explore the transition against your own capabilities. Which duties could you take over? Which need training, a hire or continued seller involvement? Ask whether licenses, technical knowledge or relationships depend on the owner personally. Record these as matters to investigate with the appropriate advisors rather than assuming they transfer with the business.

Do not promise that existing managers will absorb extra responsibilities. Learn what they already do and what the seller knows about their interest in a transition.

Discuss customers and key employees with care

Start with how the business wins and retains work. Ask why customers choose it, who manages the largest relationships and what causes customers to leave. Distinguish repeat purchasing from an actual contractual commitment. Ask what the owner means by recurring revenue if that phrase appears in the CIM.

You can discuss concentration without requesting customer names on the first call. Ask how revenue is distributed and whether major accounts depend on the seller. Request supporting schedules later through the agreed process.

For employees, ask which roles are hardest to replace and who holds knowledge that others lack. Discuss hiring needs, recent departures and management responsibilities. Confirm who knows about the sale process before proposing introductions or meetings. Early curiosity does not justify exposing a confidential process to the team.

When the seller describes a strong manager or loyal customer, preserve that description as the seller's view. It becomes a diligence question until you have supporting evidence and authorized access to test it.

Ask how the CIM numbers were prepared

Use the financial discussion to understand the records and their preparation. Ask who assembled the CIM figures, which accounting records they used and which period the figures cover. Clarify whether the latest period is complete and whether the figures use the same accounting basis throughout.

Bring the seller's earnings reconciliation to the call. Choose the adjustments most relevant to your operating plan and ask how they were calculated. If owner compensation was added back, connect the answer to the duties you just discussed. If an expense is called non-recurring, ask what happened and whether similar costs appear elsewhere.

Keep the tone specific and neutral. "What work did this person perform, and who would do it after closing?" is more useful than asserting that a payroll add-back is wrong. If the broker or accountant prepared the schedule, ask who should answer the follow-up.

Request the records that would help resolve the question. An owner may not have a reconciliation available during the call. Record the gap and the agreed next step without treating uncertainty as either proof of a problem or confirmation of the CIM.

Follow the conversation and close with agreement

Ask one question at a time. Allow the owner to finish, then use their answer to choose the follow-up. A concrete account of a difficult customer delivery may explain staffing, margins and the seller's role better than several broad questions.

When an answer surprises you, summarize your understanding and invite a correction. Separate the correction from your interpretation in your notes. If time is running short, address the question most likely to change whether you proceed and defer the rest.

Before ending, recap what you understood about goals, timing and the next exchange. Confirm who will send which information and when you will respond. For a represented seller, agree with the broker how to route that follow-up. Thank the owner for the specific context they provided rather than making a premature statement of commitment.

Record the decision while the call is fresh

Keep a dated note with attendees, seller statements, your interpretations and unresolved questions in separate sections. Reference the relevant CIM page or schedule when the discussion changes your reading of it. Record any correction to a figure with its source and status rather than silently replacing the original.

Assign each follow-up to a person and a date. Then choose a next step:

Pass when a confirmed fact conflicts with a firm constraint. Record the reason and communicate through the agreed channel.
Ask more questions when a specific missing answer could change the decision. Request the evidence needed to resolve it.
Prepare an IOI or LOI when the available evidence and process justify a proposal. Keep unresolved assumptions visible and review the terms with your advisors.

Use the LOI preparation guide when translating those assumptions into a proposed transaction. A positive conversation supports further work; it does not settle diligence or financing.

SearchWare's search fund CRM connects owner and broker contacts with deals and follow-ups. Its meetings and integrations workflow keeps meeting notes and action items with the acquisition record. Bring your next seller-call notes to a SearchWare trial, and review plans and feature availability.