By: David Frankel | January 2025

A portfolio company of ours was recently acquired, and it reminded me of some advice I’ve shared with founders during my investing career.

🧬 Understand Buyer Motivations: Know whether the acquirer values your tech, team, or revenue to align your pitch.

🔒 Fully Commit to the Process: Selling is highly distracting; don’t proceed unless you’re all in.

🕉️ Manage Team Expectations: Prepare your team for potential deal failures to maintain morale and performance.

💰 Maintain Financial Leverage: Keep at least nine months of runway to avoid losing negotiating power.

👔 Hire an M&A Banker: Their expertise and negotiation skills can prevent costly rookie mistakes.

🏁 Secure Multiple Bidders: Competition drives better terms, so always aim for more suitors.

📂 Prepare a Data Room Early: Detailed documentation is critical for due diligence and speeds up the process.

🕵️ Limit Information Sharing: Only involve aligned stakeholders to avoid leaks and disruptions.

📣 Leverage Leaks if They Happen: Use media leaks strategically to spark interest from other potential buyers.

⏳ Anticipate Delays: Corporate priorities can shift; don’t panic if talks temporarily go silent.

New addition:

📈Let it grow: If you’re reasonably happy with your company and team, stick with it. You may be surprised by how hard it is to recreate the spirit of creative collaboration and how much value a thriving team can add in a few years.