Acquisition joy and heartbreak

Used to be a time when selling the company was akin to selling the family silver.  Not anymore.  Many companies today are “built-to-flip” – i.e. created in the expectation that they will be bought out by a larger player at some point.

It’s a tricky game.  Sell too early, and you’ve lost a lot of the value.  Sell too late, and you may actually find very few buyers out there (many tech companies in India are discovering that today).

And, how does one position oneself for a sale?  What is the right way to maximise value for oneself?  What are the things that  may go wrong?  Really little literature on the subject – one is forced to go by the advise of people around you.  Hopefully they’re right!

And for those who come close to a sale and fail, it can be heartwrenching.  Years of work, the smell of success, and the numbness of the rug whooshing from under one’s feet.

Which is why this is a really interesting story of joy and heartbreak.  Backblaze – the online storage company went through the roller coaster, and has now told the tale.  Some excerpts:

We Signed The Offer!
Woohoo! Pop the champagne! Well, actually, it was around 2am at this point, so it was more like “woohoo, go to bed”. But, with some trepidation about the decision, we were all excited to have signed and to move on to the next step.

Fast forward a few months:

Saturday. Exclusivity expired.

Warning bells went off. It was possible that Cogswell forgot the exact date of exclusivity expiring and thought they were still under exclusivity. Maybe Cogswell wasn’t worried about it because we were so close?. While both were possible, the paranoid senses were saying something was wrong.

Monday morning I got a call from Cogswell’s CEO. “I’m sooo sorry.”

….

We were roughly back to where we were six months earlier.