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Watching an acquirer ruin your company

startupwin.kelsus.com

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Re: Watching an acquirer ruin your company

#321

Post by kurthr »

robbintt wrote: post #318
kurthr wrote: post #23

Earlier quoted context omitted.

Often acquisitions are set up with "earn-outs" so that only with the success of the project do you get the full amount of the buy. Even when that's not the case your reputation may well be tarnished by any failure (whether technical or managerial) of the product. I agree with your point though, which is to just walk away with the check unless you're willing to take a significant risks with either of those two other o…

Do you know where I can read more about the structure of "earn outs"? They seem like just another trap, to be clear.

I'm not an expert, but I've seen the inside of a couple of deals like this in the $100M range. I saw larger % earnouts than described below (e.g. in the 30-50% range), which were based on milestones (e.g. products going to market on time) and income (e.g. $ customer sales over following several years). It's worth noting that the deals closed in a significant amount of stock so that is also an incentive to keep the buyers price high (but that the earner realistically has limited influence over that).

https://news.crunchbase.com/ma/earnout-plan-startup-sale-how...

Re: Watching an acquirer ruin your company

#322

Post by leaflets2 »

hansword wrote: post #145
AussieWog93 wrote: post #84

Earlier quoted context omitted.

Have you ever started a business before? Yes, you technically no longer own it once sold, but there's a huge amount of blood, sweat and tears that goes into building something from nothing - not to mention a sense of loyalty to your staff - and you genuinely do want to see it go into good hands and become managed well. I guess a somewhat leaky analogy would be like giving away a dog you raised to another family and f…

(a) if you want the dog to go to good hands, don't sell it. Spend time finding the best hands possible and give them the dog. (b) as you might see, your analogy is not very good. (c) if you find you care about the money, sell it to the highest bidder. be happy with the money. (d) if you find you care about the fate of the company, perhaps not sell it? or if you do, sell it to someone who also does? or if you don't, a…

> sell it to someone who also [cares about the company]

That's easy to say

But it partly requires reading someone else's mind

Re: Watching an acquirer ruin your company

#323

Post by hinkley »

mruniverse wrote: post #182
lovich wrote: post #81

Earlier quoted context omitted.

> I don’t know which business school teaches people to say “ah can you smell that fresh mountain air” while they have their hands wrapped tightly around your neck … It’s all of them and the higher you get into management the more apparent it is. They sell a system of meritocracy where those who work the hardest get the rewards. Then you get into management and working side by side with people whose first job out of c…

> Software engineers have been tricked... I think of this when managers come up with different requirements during the project. If the requirements seem to make the product better, I'm all for it. I like to work this way and they pat me on the head for being "agile". But I always end up kicking myself when they ask why the project is taking longer. I fall for it almost every time because I like to tinker.

One of these days when I’m feeling salty I’m going to make a wiki page called “why is it taking so long” and list every feature that drew out the schedule. Hopefully it’ll be seen as helpful, but probably not.

Re: Watching an acquirer ruin your company

#324

Post by closewith »

andruby wrote: post #319
closewith wrote: post #205

Earlier quoted context omitted.

That seems like an example of selection bias. Does the average software developer in France earn €39k? Does the average pilot earn $116k? The answer is obviously not - do you have any salary data?

Did you look at the links? They both claim their numbers are averages. I’m not saying they are perfect sources, but they do align with anecdotal datapoints.

Neither are reputable sources, I'm afraid.

> I’m not saying they are perfect sources, but they do align with anecdotal datapoints.

So you say, but that's definitely not true for me (who lives in the States and Ireland). In fact, it's an absurd claim to me.

Re: Watching an acquirer ruin your company

#325

Post by andruby »

closewith wrote: post #324
andruby wrote: post #319

Earlier quoted context omitted.

Did you look at the links? They both claim their numbers are averages. I’m not saying they are perfect sources, but they do align with anecdotal datapoints.

Neither are reputable sources, I'm afraid. > I’m not saying they are perfect sources, but they do align with anecdotal datapoints. So you say, but that's definitely not true for me (who lives in the States and Ireland). In fact, it's an absurd claim to me.

It’s absurd in most countries I’m sure. The OP said

> airline pilots are paid more than programmers here

(emphasis mine)

I just gave one geographical example where I believe that to be true. I don’t think it is true everywhere, nor do I think OP meant that.

Re: Watching an acquirer ruin your company

#326

Post by ratww »

sverhagen wrote: post #316
ratww wrote: post #222

Earlier quoted context omitted.

IMO nobody should "give their best" at a job they feel has enough red flags to warrant a search for a new one.

I agree, so I'd quit and find something better. That's all I'm saying: it's one or the other, not both (for me).

If you're in a privileged position of quitting, then sure.

I personally know better not to judge people who are not.

A job doesn't deserve more from you than it gives you.

Re: Watching an acquirer ruin your company

#327

Post by closewith »

andruby wrote: post #325
closewith wrote: post #324

Earlier quoted context omitted.

Neither are reputable sources, I'm afraid. > I’m not saying they are perfect sources, but they do align with anecdotal datapoints. So you say, but that's definitely not true for me (who lives in the States and Ireland). In fact, it's an absurd claim to me.

It’s absurd in most countries I’m sure. The OP said > airline pilots are paid more than programmers here (emphasis mine) I just gave one geographical example where I believe that to be true. I don’t think it is true everywhere, nor do I think OP meant that.

It seems clear he means in Europe from his preceding sentence, where I think it is absurd ( including in France).

Re: Watching an acquirer ruin your company

#328

Post by lizknope »

ncmncm wrote: post #228
lizknope wrote: post #196

Earlier quoted context omitted.

I'm curious which companies you are talking about? I design semiconductors and I use EDA software everyday. I know Cadence was formed from a merger in 1988 and they have since bought around 30 other EDA companies. https://en.wikipedia.org/wiki/Cadence_Design_Systems

Back then the big EDA outfits were Mentor Graphics, Daisy, and Valid. ECAD became Cadence, embraced silicon compilers, and ate everybody's lunch. Back then, chips were still laid out by pasting up prepared logic blocks, gates, and occasional custom transistors, and routing metal traces between them, all on what we would today call a low-resolution workstation monitor. A million transistors was a lot. These would be o…

I started working in 1997 doing digital physical design.

I had never heard the term "silicon compiler" before so I looked it up.

https://en.wikipedia.org/wiki/Silicon_compiler

Silicon compilation takes place in three major steps:

Convert a hardware-description language such as Verilog or VHDL into logic (typically in the form of a "netlist").

Place equivalent logic gates on the IC. Silicon compilers typically use standard-cell libraries so that they do not have to worry about the actual integrated-circuit layout and can focus on the placement.

Routing the standard cells together to form the desired logic.

So this is basically what I do everyday but we just call it logic synthesis (Synopsys Design Compiler / Cadence Genus) and Place and Route in Cadence Innovus or Synopsys IC Compiler. We use Mentor Calibre for LVS/DRC.

I've worked in serdes teams where there is a lot of custom analog design with manually sized transistors and custom layout in Virtuoso. I'm working on chips in 5nm that are over 20x20mm so it would be impossible to do those without all the automation and it is still tons of manual work.

Some of my older coworkers told me about doing layout on transparencies and colored pencils in the early 1980's.

Re: Watching an acquirer ruin your company

#329

Post by anticensor »

ncmncm wrote: post #44

Possibly more common is when the company is bought specifically to shut it down, because the product's success would hurt, or is hurting, sales of their own product. There used to be a category of software called "electronic design automation". It presented an interactive editor where you could enter the schematic diagram of an integrated circuit, and also enter a chip layout, and it would ensure that they matched. I…

> Google's hiring system is so Byzantine that buying companies, bypassing it, might be their main recruiting method.

Wrong. Google actually fires all former employees of acquired companies once a certain protection period in the acquisition agreement is over, unless they individually pass the tests applied to new employees.

Re: Watching an acquirer ruin your company

#330

Post by anticensor »

yieldcrv wrote: post #142
HWR_14 wrote: post #137

Earlier quoted context omitted.

> For some of my trades I have a 100% premine of shares and sell them at a higher price until I’m down to 20% left but only because I minted 500% more shares to sell to the PE guys I didn't understand your example at all. Care to explain?

When you create a new company, you write down an arbitrary number of shares that it is made of, and give yourself 100% of them at $0.00. From then on, the goal is to sell shares at > $0.00 But instead of selling any of those shares, when an investor comes you create a bunch more shares at $0.00 and sell them, dropping your percent of ownership to < 100% while not incurring a capital gains tax event.

> When you create a new company, you write down an arbitrary number of shares that it is made of, and give yourself 100% of them at $0.00.

Initial capital is a thing, and most jurisdictions have strict requirements on the minimum and maximum size of initial shares.

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