3 tips for considering an acquisition
Some companies have seemingly no choice but to merge when market pressure or the cost of operations becomes unsustainable. However, many tech executives have a wide array of M&A options to consider when they feel their company's growing pains. Here are some tips for making a measured and thoughtful acquisition decision:
Don't be hasty. One of the best things a decision maker can do while navigating that process is to be sure not to rush into anything. Granted, some deals have a very specific clock to watch. But if you're not completely sold on the idea of selling your company, either to a specific buyer or at all, take your time to arrive at certainty. Seller's remorse is just as real as buyer's remorse, and startup founders have usually invested their life's work into developing their brand.
Keep your options open. It could be that now isn't the right time to merge for your company, but never say "never."
"What I really want to be doing is developing the technology ourselves, potentially licensing it from someone else or partnering with a company," said Jonathan Chadwick, finance chief at software company VMware. "We exhaust all alternatives before we think about an acquisition, because if I can leverage fewer dollars, or leverage more options through a set of partnerships, I probably have more reach."
Look for outside opinions. All startup entrepreneurs can't be legal experts, finance gurus, brand strategists and negotiators at the same time. Assembling a team of people internally can help ensure that all considerations are made before closing a deal, and third-party consultants can give an objective view of the situation.
With the guidance of an experienced M&A advisor, your company can be guided through every stage of the acquisition process. Contact us today to learn more about our suite of services for tech firms.