Learnings from an acquisition (SUP)

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A SUP alumni (prefers to be anonymous) candidly shares valuable learnings of a successful acquision process.

Published/Updated on Jan 16, 2021

By: Anonymous founder & SUP alumni
Published: March 2023

Being approached by someone who wants to buy your company?
We were. It kickstarted 6 months of a ton of learning. First of all, if you have a co founder, speak with them immediately, decide what you think of the topic. Exit is a board matter, bring it to the board quickly. I found that the input from the board decided our course of action but most importantly in the manner in which we continued.

"They are buying, you are not selling"
We were approached. Meaning, a company wanted to acquire our company. The board taught me a valuable lesson about this immediately. Their words โ€œnever forget, they are buying, you are not selling.โ€
This advice was incredibly useful in negotiations and keeping the spirit high through tough times. At one point, the buyer asked me โ€œok whatโ€™s it gonna take?โ€ , my answer was very much the boardโ€™s advice โ€œI have no number. You want to acquire our company, you have to do all the math.โ€ Now, I said this nice and polite even if it may sound rude. We understood each other well and they understood that it was simply not in my power to dictate a number. We had to let the acquiring part do this job.ย 

The actual plan
Having an acquisition process happening is distracting and takes a ton of time and braintime. However, it is important to understand that this process is not the companyโ€™s actual plan. You already have a plan, a strategy and goals. Donโ€™t stray from these. You want to sit at a negotiation table with strong cards and no rush or real reason to agree to an acquisition.ย 

The team
(Founders + board + DLA Piper + GP Bullhound)
This was a tricky part. How do we tell the team that we might be acquired without distracting everyone?
For us, we took the information to the management team to get input, followed by an allhands. I think the most important piece was to make clear that while we are being approached, we still had our real plan and that that was most important. We kept the team in the loop to get rid of guess work and rumors. As ceo I probably spent the most time on the acquisition process.

The team was excited and naturally, everyone looked up the company i