[bluethunder]

Couple of quick points, though this is a very subjective topic so these might or might not apply.

1. Know that 99% of deals fall through. This one will also, except when it won't. More importantly, the deal is only done when the cash hits the bank. Deals are known to fall through even at very late stage. Falling through is the norm, going through is the exception.

2. Be open about numbers, growth etc. Be closed(vague) about strategy, execution plan etc. You need to be open about the numbers to give them confidence. You need to be closed about strategy, execution plan because a huge number of deals fall through because the acquirer decides to build the same stuff inhouse (typically prodded on by internal engineering teams)

3. Build confidence. Talk about how this marriage will be best for both the teams. Reserve the negotiations around cash towards the end of the deal. When you start negotiating about cash, the deal is already done.(Except when it isn't - see point 1). Negotiating the deal is though topic for another post.

4. Decision making in big companies is slow and hard. The decision to acquire your startup will need to be driven by someone internally in that company. Find out who your 'champion' is in that company. Maintain regular contact with him, though dont push him too much. If some time elapses without any communication, ping him and check with him.

5. Most deals that go through will go through quickly. The decision in most of the deals which go through is already made. You just need to nod your way along in such cases. In other cases there will be just one big issue that you need to build confidence upon. If the talks get extended, it is likely that the deal will not go through.

6. The Zen Rule for Deals: Assume that the deal will NOT go through and plan your startup accordingly. The person who is willing to walk away is the stronger person in any deal. Detachment will allow you to negotiate from a position of strength.

[beingacquired]

This is extremely good information, thank you. We have been careful in how to describe to them what our long terms goals are without being specific what technology we have up our sleeves. It's been great reading HN for so long, I feel like I have the basics down - be calm, expect nothing, carry on as usual. But cross fingers.

>Negotiating the deal is though topic for another post.

I would like to read this post :)

[bluethunder]

Thanks for your kind comments.

Im not sure if I would be able to post about negotiations any time soon. Drop me a line when you enter negotiations and if you want an outside perspective. I will be happy to help. You can reach me through the feedback form of the site in my profile.

[enjo]

#4 is the most important on the list. There is someone championing this. You must figure out how they are, and what their motivations are. Not only to help the deal through, but understanding their motivations will help you understand if it's right for your team.

Are they buying you just to get you out of the way? Is that ok with you?

[beingacquired]

We seem to be ok with #4 so far, but we'll see. They'd be buying us for our technology and staff, we've gone really far where they want to go and I've had an intimation that they've put some R&D into it already and figured out that it's pretty complex stuff to do well. It's been an honor to have so many great responses, I'll post back here with an update (some weeks from now.. Christmas is going to be nerve-wracking unless Big Company really just wants to get this done before the end of the tax year).

[ooorrr]

Having gone through acquisitions myself, I've learned that BigCo tax issues are entirely different than YourCo tax issues - i.e. they're going to think about taxes (cap gains, operating taxes, etc.) with different rules than you will.

In other words, don't worry about that part. :)