We were delighted to have Christina Farr from VentureBeat as a guest in our office to talk about the nuts and bolts of the technology M&A process. Managing Partner Jim Moore led the session and discussed everything from how to approach this complicated process to preparing for pitfalls along the way.
It’s not surprising there is heightened interest around M&A, especially since it was announced last week that 2012 IPOs slumped to the lowest level since the financial crisis. With the less-than-stellar (and highly publicized) IPO performances of Facebook and Zynga, we expect to see an increase in activity in M&A in 2013.
To sum it up, IPO is no longer the only mark of a successful company. It’s important for founders to know all of their options – and the sooner, the better. By preparing for an exit from the start, and bringing in helpful experts along the way, entrepreneurs can focus on the most single most important part: continuing to grow the business.
The result of our session was the Idiot’s Guide to technology M&A, the third in a series of Idiot’s Guides (see also Angel Investing and Getting Funded). Check out the start of the M&A Idiot’s Guide below and read in entirety here!
Most entrepreneurs will tell you they’re going big and will accept nothing less than an IPO. But when the reality of running a business sets in, getting acquired is no small feat, itself.
“With the exception of about half a dozen companies, every tech startup is for sale,” said Jim Moore, founder and CEO of J Moore Partners, a firm that specializes in tech M&A.
In Silicon Valley, where startup activity is at an unparalleled high, mergers and acquisitions are the fastest-growing exit for venture-backed companies. According to a recent study by Ernst and Young, the volume of M&A in the technology space surged 41 percent in 2011, reaching levels not seen since the dot-com boom.