Every experience is a step towards learning and growing. My first acquisition of The Boston Group (bostongroup.com) was nothing short of a steep learning curve. As a first-timer steering through the acquisition waters, each phase unfolded lessons that are now etched in my professional journey. I recognize that acquisitions are routine play for some, and that the insights shared here may feel like stating the obvious. If you’ve been through the grind of multiple or even a single acquisition before, this might not be the blog for you. However, these are my candid observations for those sailing in similar waters for the first time.
So, here we go…
Lesson 1: Foster a Strong Partnership with the Seller
At the crux of any deal is the partnership between the buyer and the seller. Unlike the cutthroat scenarios painted in shows like Suits, the reality is more about building rapport and aligning goals. Both parties are humans with genuine emotions and aspirations tied to the outcome. A harmonious partnership ensures the transition phase rolls out smoothly, keeping any hostilities or misunderstandings at bay.
Lesson 2: Due Diligence is Imperative
Due diligence is a critical practice that underpins a successful acquisition. It’s about digging deep into the financial, legal, and operational facets of the company in question to unveil any potential red flags or undisclosed liabilities. This phase is not to be rushed but should be meticulously carried out to ensure a fair deal for both parties. This is your chance to do your homework: make sure you take the time to do it right!
Lesson 3: Understand the Pulse of the New Staff
Acquiring a company is not just about numbers and assets; it’s a transition that impacts real people. Engaging with the new staff, understanding their expectations, and ensuring a smooth transition for them is equally crucial. Their expertise and cooperation could significantly influence the successful melding of the acquired company with yours.
Lesson 4: Hold Onto Your Core Values While Embracing New Ideas
Every acquisition brings forth a blend of cultures and ideologies. While it’s essential to stay rooted in your core values, being open to fresh perspectives and ideas can fuel innovation and growth. It’s all about striking a balance between maintaining your company’s ethos and fostering an environment that welcomes change.
Lesson 5: Keep Up With the Rollercoaster of Deal Finalization
The journey from the negotiation table to shaking hands can be a bumpy one. A deal may face numerous setbacks, and it’s not uncommon for things to die down a few times before finally sealing the deal. Patience, perseverance, and a willingness to revisit terms can be the name of the game.
Lesson 6: Dive into the Day-to-Day Pre-Closure
If feasible, getting involved in daily operations before the deal closure can provide invaluable insights. It will help you understand the workflow, identify potential challenges, and facilitate a smoother transition post-acquisition. If you wait until after close, you may be absorbing too much too fast, ultimately being ineffective in what you are trying to achieve.
Lesson 7: Surround Yourself with the Right Advisors
In the whirlpool of emotions and decisions, having a circle of strong, experienced advisors can be a lighthouse. They help maintain a clear picture, offering unbiased advice and ensuring that rationality prevails over emotions. Even though I felt prepared, I came across many questions I did not know the answer to. Having trusted advisors to lean on gives you the confidence required to navigate a deal.
Lesson 8: Do Not Lose Sight of Your Existing Venture
If you are juggling running your existing company and navigating through an acquisition, ensuring both are on the radar is crucial. Manage your attention and resources judiciously to ensure both entities thrive. Do not be afraid to empower others to help you navigate the ship of your current company so you can give some additional attention to the acquisition.
The voyage through my first acquisition was both challenging and enriching. Each hurdle shaped me, leaving me ready to embrace the future with a blend of enthusiasm, experience, and caution.
On to the next one…maybe?