[sethg]

Kenan Systems, where I worked a decade ago, might provide a cautionary tale. Kenan Sahin built the company up into the 800-pound gorilla of telecom billing software without giving up any of his equity in it. Then he looked at how he wanted the company to expand, looked at the competitive environment, and decided that he needed more capital to avoid being leapfrogged. So he sold the entire company to Lucent, whose CEO was on an acquisition spree.

Unfortunately, Lucent was at its peak when it bought Kenan Systems and, briefly, everything started unraveling within a year of the acquisition. Lucent eventually sold the Kenan division to CSG, which later sold it to Comverse. A friend of mine, who had joined when it was still Kenan Systems, was laid off a few months back; her co-workers told her she was lucky to be laid off while the company could still afford to give her a decent severance package.