Earlier quoted context omitted.
M&A stupidity is not the same as fraud though. M&A is hard. It's not unreasonable for execs to tell the team not to do X because they're buying it, and then to screw it up. It's also normal for companies to want to buy via a dealer because they don't want to deal with your little startups legal issues, compliance, regulatory, billing. They just want to deal with small tier of vendors. In fact, that's kind of a startu…
I'm privy to more details than I am giving out. I've been in SV for over 15 years and I have seen a lot in that time. I'm aware of what is normal. There is normal purchasing intermediaries and then there are purpose built bribe vehicles. We're not talking 10% it's more like 100% to 1000%.
That so many M&A deals are so blatantly shady it completely shocks me that CEOs/Boards/Shareholders aren't more vigilant about it.
In your view, are the the most respected firms more or less immune from that, (maybe because they do really well and don't need to), or are they the worst offenders? Or is there a differentiation for simple favours for favours i.e. VC ABC wants to find a home for a project and it actually does make some sense that company XYZ would want to buy it, the deal is done and that's that. Maybe the M&A lead at XYZ later does get a nice job somewhere, but is it really that sweet of a deal to the point wherein it constitutes fraud? Is the M&A guy really getting a simple consulting job that pays 'many millions'? Or is it in XYZ's best interest to have a good relationship with the VC firm and to buy the semi crap companies so they get access to the good one's as well? And what percentage of M&A deals would you say follow this angle?