Company Acquisitions: Dispelling 7 Myths and Misconceptions About Getting Acquired

The acquisition is an exciting milestone for SaaS Founders. But several misconceptions can cloud our understanding of the process. Let’s debunk seven common myths and get a clearer perspective on M&A deals, getting acquired, and SaaS exit strategies.

Myth: Only big companies are getting acquired

Reality: That’s a falsehood that a lot of acquisition marketplaces like acquire.com, Flippa, and others are fighting tooth and nail to kill. Founders of any SaaS company, regardless of size, have great potential to find acquisition opportunities. For bigger companies, it can be an important merger. While for smaller businesses, it’s a great way to expand their customer base, reach new markets, and enhance their product offering.

Myth: You’ll lose control of the company after the acquisition

Reality: It can be part of the deal if you want to. Some founders would rather cash out as soon as possible because they are burned out and don’t want to be involved in the business anymore. But many successful acquisitions involve as much or as little collaboration between the founder and the acquirer as they wish. You can negotiate terms that allow you to maintain involvement, preserve your company culture, and even lead important initiatives within the acquiring organization.

Myth: Selling a SaaS Business is a Complicated and Long process

Reality: It doesn’t have to be that way. While a Google search indicates the average time to acquire a business is between 6 and 12 months, there are companies, including saas.group, that try to streamline the process to just eight weeks. It helps if you’ve been preparing for the process beforehand. So, if you’re looking in the direction of selling your company, start planning right away. By preparing your documentation, identifying potential buyers, and seeking guidance from professionals, you can simplify the process and stay focused on what matters most.

With that, the process can be an easily manageable and rewarding experience instead of a daunting super marathon.

Myth: Acquirers only care about the profits

Reality: Financial aspects are really important. But other equally important factors need to be determined. Potential buyers also look for strategic value, synergies, intellectual property, and a strong customer base. They want to see the bigger picture and how your business aligns with their long-term goals.

Myth: The original team gets laid off after the acquisition

Reality: Your acquirers understand that the people on your team are the people who made this company what it is. It’s the people who helped your company become attractive to buyers. So blindly ditching them would be a not-so-smart move. Keeping the team intact may provide additional growth opportunities, resources, and expanded roles within the new organization. It doesn’t necessarily mean there won’t be any restructuring, but it’s safe to say that you’ll get to keep most of your talent.

Myth: Selling SaaS means giving up on your vision

Reality: As mentioned before, founders can remain as involved as they wish after the deal, depending on their exit strategy. There are different deal structures to explore. You don’t have to sell the whole business. It can be a strategic partnership, a partial sale, a merger, etc. These provide founders with the opportunity to take on a leadership role while maintaining their influence and impact. It's about finding the right path that aligns with your long-term goals and personal vision.

Myth: Integration is difficult and means losing the culture

Reality: It’s definitely no picnic, but there are steps to take to build a foundation for a smoother process. Aligning cultures, content, product, and marketing, visions take time and effort. But with intentional communication and effective collaboration, acquirers and teams can unlock the full potential of the acquisition.

Conclusion:

Acquisitions can be an exciting path for growth, collaboration, and strategic advancement. Don’t let myths stop you from looking for a new home and a great partner for your business. Get your exit strategy figured out, do thorough research, and don’t be afraid to ask questions.

Also published here.