How to Sell Your Company’s Assets to Raise Capital

There are several types of companies and investment firms that specialize in buying other companies’ assets. These transactions can take many forms, such as buying intellectual property, equipment, real estate, or even entire divisions of a company. Here are the main types of entities that engage in asset acquisitions:

1. Private Equity Firms

• How they work: Private equity firms often acquire entire companies or specific assets of companies that they believe are undervalued or can be turned around for profit. They typically restructure, improve profitability, and sell the assets or company at a higher value.
• Types of assets acquired: Entire businesses, divisions, intellectual property, technology, or real estate.
• Examples: Blackstone, KKR, Carlyle Group.

2. Venture Capital Firms

• How they work: Although more commonly focused on startups and emerging companies, some venture capital firms buy assets, particularly intellectual property or technological assets that align with their portfolio companies’ growth strategies.
• Types of assets acquired: Intellectual property, patents, technology, and sometimes struggling companies with valuable assets.

3. Distressed Asset Buyers

• How they work: These companies specialize in buying assets from distressed businesses that are in financial trouble, such as those undergoing bankruptcy or liquidation. The goal is often to purchase assets at a lower price and resell or repurpose them for profit.
• Types of assets acquired: Equipment, real estate, inventory, intellectual property, and any valuable physical or intangible asset of a failing company.
• Examples: Hilco Global, Gordon Brothers, Great American Group.

4. Strategic Buyers (Corporations)

• How they work: Larger corporations may acquire specific assets from other companies as part of their growth or strategic goals. These acquisitions are often part of a broader strategy to enter a new market, enhance their current product lines, or eliminate competition.
• Types of assets acquired: Product lines, intellectual property (patents, trademarks), key talent or teams, technology, or brands.
• Examples: Google, Apple, and Amazon have all acquired technology and talent from other companies to enhance their operations.

5. Asset Management Companies

• How they work: Asset management companies may buy physical or financial assets from businesses. They may specialize in real estate, stocks, bonds, and other financial instruments but also deal with corporate acquisitions.
• Types of assets acquired: Real estate, stocks, intellectual property, and entire business units.
• Examples: Brookfield Asset Management, Apollo Global Management.

6. Real Estate Investment Trusts (REITs)

• How they work: REITs specialize in acquiring commercial real estate or property assets from other companies. These firms can purchase individual properties or portfolios of properties from companies looking to divest real estate holdings.
• Types of assets acquired: Commercial properties, office buildings, retail spaces, industrial properties, and other real estate holdings.
• Examples: Prologis, American Tower, Simon Property Group.

7. Liquidators

• How they work: Liquidators help companies sell off their assets quickly, often at auctions, when they are going out of business. They work with companies that need to turn assets into cash rapidly and specialize in selling a wide range of corporate assets.
• Types of assets acquired: Inventory, equipment, machinery, fixtures, and real estate.
• Examples: Liquidity Services, Bidspotter, Bargain Hunt.

8. Technology Acquirers

• How they work: Some companies specifically focus on acquiring technology assets, such as patents, software, or entire tech teams (“acqui-hiring”). This can be done to improve a company’s R&D capabilities or to enter a new tech market.
• Types of assets acquired: Patents, proprietary technology, software, and even tech talent.
• Examples: Microsoft, IBM, Facebook have all acquired smaller tech firms or their intellectual property.

9. Franchisors and Franchisees

• How they work: Franchisors or large franchise groups may buy individual franchise locations or a group of locations from other franchisees. These acquisitions can include not just the business operations but also real estate, equipment, and intellectual property tied to the franchise.
• Types of assets acquired: Franchise rights, real estate, and operating assets (restaurants, hotels, gyms, etc.).
• Examples: McDonald’s, Subway, Marriott (through franchise models).

10. Intellectual Property (IP) Buyers

• How they work: Specialized companies or IP investment firms buy patents, trademarks, copyrights, or other forms of intellectual property from businesses. These firms often monetize the IP through licensing or lawsuits for infringement.
• Types of assets acquired: Patents, trademarks, copyrights, proprietary processes.
• Examples: RPX Corporation, Acacia Research Corporation.

11. Holding Companies

• How they work: Holding companies invest in and acquire a range of assets, sometimes buying entire companies or their most valuable divisions. They typically manage multiple businesses or asset portfolios under one corporate umbrella.
• Types of assets acquired: Entire companies, business units, intellectual property, brands, or real estate.
• Examples: Berkshire Hathaway, Icahn Enterprises.

12. Investment Banks

• How they work: Investment banks often facilitate the acquisition of assets during mergers, acquisitions, or bankruptcies. While they may not directly buy assets themselves, they broker deals for companies looking to acquire or divest specific assets.
• Types of assets acquired: Companies, divisions, intellectual property, real estate.

Key Factors that Influence Asset Purchases:

• Distressed Sales: Companies in financial trouble often sell assets at a lower price to raise capital quickly.
• Strategic Fit: A company may buy another’s assets because they align with their strategic goals (e.g., entering new markets, acquiring technology).
• Valuation: Buyers are typically looking for undervalued or highly strategic assets that can be turned into a profit or give them a competitive edge.

In summary, companies that buy other companies’ assets range from private equity firms and strategic buyers to liquidators and intellectual property specialists. The type of assets being sold (real estate, intellectual property, product lines, etc.) will often determine which types of companies are most interested.