11–20 of 32 posts
First of all, its excellent news that the FAANG is willing to talk about this. That deserves congratulations alone. That said, if this is the first conversation, be cautious. After all, what stops them from using the conversation to identify who your star people are, and simply poaching them after your company winds up? Assuming that you are further along, you need to identify which big org division of the FAANG you…
1) To maximize your chances, you need to speak with multiple companies and get multiple offers. Offers fall through so it's good to have backups and be able to tell potential acquirers that there is other real interest to up the urgency. If you haven't already told your team, you should tell them so they can prepare for interviewing with potential acquirers. If the majority of the team doesn't pass their interviews and/or is not a good fit for the company, they will pass. If a single person does not pass, they might decide to offer the whole team roles besides that person (happened to us).
2) Packages vary based on what you have to offer and how you can sell the team. In our case, investors got some shares in the acquirer (didn't match their ownership in the company, but at least they got something), there was a big PR campaign that saved face for the founder/investors/team, and the employees (including me) got solid base offers in addition to a small equity bump beyond our base grants.
3) From when I was told to when the deal was done, it took ~2-2.5 months. There was definitely some work the founder did prior to letting the team know, like gauging interest with founders/executives of the potential acquirers.
4) I wouldn't worry about this since you don't know what environment you are going into. In my case, it took a while for employees at the acquirer (~100 employees) to accept the the rest of the team and me, but ended up working out (we all stayed at least a year, most of us 2+ years).
Stop all work that isn't trying to sell the company and preparing for interviews. You may want to consider raising a bit more to bridge for another 3-4 months so you are covered if the acquisition process takes longer (e.g. during the summer key people might be out of office). This will also allow you to convince other potential acquirers that there is "synergy" to bringing your team and you in.
Tell them we're out of money and they need to find new jobs. I can't imagine you getting a sell done within 2 months.
Be an adult, shake everyone's hand and apologize. This is the startup life, we all know what we're signing up for.
That said, your investors might prefer you asking for more money while you try to sort out a sale vs just going out of business. This is very complicated, I'd talk it over with a professional of some sort.
For the love of God, communicate with your team on this. Give them a few weeks to find jobs.
Going to be frank with you. 1.5 months is not enough time. Go through the motions and meet with FAANG, but for all intents and purposes it is too late. There’s very little incentive for BigCo to buy a dead company.
Tell the team now, pay out their salaries for next 1.5 months but have them focus full time on getting new jobs. That’s the best you can do for them.
First of all, its excellent news that the FAANG is willing to talk about this. That deserves congratulations alone. That said, if this is the first conversation, be cautious. After all, what stops them from using the conversation to identify who your star people are, and simply poaching them after your company winds up? Assuming that you are further along, you need to identify which big org division of the FAANG you…
excellent advice, thank you!
Interesting. Ive always thought FAANG reaches out to small companies, not the other way around
What we are working on is very relevant / core to what this BigCo does so there are legit reasons why they are interested. One of our investors made the intro to a very senior VP there who told Corp Dev to speak with me.
I was in the spot of one of the employees (contractor at the time) for a further along startup that run out of money and wasn't going to get further investments. It looked like the owner of the company was under mega stress during this time, and so was I, because I was waiting on hypothetical buyers to float us cash while they did their due diligence. What ended up happening, after months of being in the dark, was th…
Thanks for sharing your experience!
Founder here of a company that attempted to do an acquihire Hail Mary. Going to be frank with you. 1.5 months is not enough time. Go through the motions and meet with FAANG, but for all intents and purposes it is too late. There’s very little incentive for BigCo to buy a dead company. Tell the team now, pay out their salaries for next 1.5 months but have them focus full time on getting new jobs. That’s the best you c…
Founder here of a company that attempted to do an acquihire Hail Mary. Going to be frank with you. 1.5 months is not enough time. Go through the motions and meet with FAANG, but for all intents and purposes it is too late. There’s very little incentive for BigCo to buy a dead company. Tell the team now, pay out their salaries for next 1.5 months but have them focus full time on getting new jobs. That’s the best you c…
I guess I'm just wondering / hoping if it is possible that the BigCo just hires our team? I understand that there isn't going to be a big (if any) pay out for us as the founders here. We've proven that we can ship product and work well together.
The interview process shouldn't take too long if they want to do it, right? Or am I being naive / grasping at straws here..