|
82
|
If
you decide to sell a company, do it when prospects cannot get
any better. "Trees don't grow to the sky." If you decide to buy
a company, beware of this feeling on the part of the seller. |
| 83 |
Purchasers
of technology companies typically shop for revenue velocity and
momentum. In other words they want fast-growing sales. Good profits
add value, but the purchaser will probably assume that after the
acquisition, the acquired company will make the same level of
profit as the rest of their organization. |
| 84 |
Competing
bids are important to getting the best price for a company. Given
that the number of potential buyers for any particular company
is fairly small, go to great lengths not to overlook someone. |
| 85 |
Consummating
a merger requires an experienced, first-class attorney that is
compatible with the owner or founder. |
| 86 |
Someone
has to drive a merger. It is as likely to be the acquired company
as the acquiring company. |
| 87 |
The
due diligence process is often very mechanical-the acquiring company
requests massive amounts of information, but does not read much,
if any, of it. |
| 88 |
When
negotiating, setting the proper expectations for price and other
emotionally-charged issues is as important as the issues themselves. |
| 89 |
The
timing of a sale needs to take into account the value of the company
on the day of the transaction and the estimated value of the "currency"
received at a time when you can convert it into cash. You should
mentally prepare yourself for a 50 percent decline in price when
taking stock. |
| 90 |
If
an acquiring company wants to retain a company founder after the
transaction, he should insist on a minimal time commitment. It
is rare for someone with an entrepreneurial personality to feel
comfortable in a larger organization. He should seek a board seat
or other position of power if a long time commitment is necessary. |
| 91 |
Perfect
deals are extremely rare. |
| 92 |
Stock
goes up and stock goes down. It is important to sell it with the
same discipline that earned it. |
| 93 |
Any
major change, such as the sale of a company, will cause some employees
to leave. All you can hope for is to minimize the loss. |
| 94 |
The
best way to minimize employee uncertainty and undesired turnover
is to make as many decisions as possible before the public announcement,
disclosing all information, both good and bad, as soon as possible. |
