Sunday, February 2, 2014

The Acquisition Blues

Founders of a small company who are acquired by a larger company are often unhappy.  The first year is often the hardest:

1. You are no longer in charge (or even influential).
As the founder of a startup you have enormous say in what happens at your company.  When you get acquired, you are suddenly no longer part of the inner circle of decision making.  Founders often feel disenfranchised and disempowered in the acquiring company.

2. Culture fit feels off.
The founders and the early employees at a startup are the foundation for the company's culture.  When acquired you go into a pre-set culture that you can not impact much.  This may lead to a feeling of cultural dissonance.  Maybe you had a team of hipster engineers in skinny jeans and you are surrounded by algorithms alpha nerds.  Or your team was all about Woz-style nerdy practical jokes and the new culture is uptight and sales-y.  Feeling culturally and emotionally in tune with the mothership may be hard.

3. You have to deal with politics.
Suddenly some random 9 to 5 middle manager is getting in the way of a product launch, hiring decision, or other key action.  You have to navigate the internal politics and winds of an organization over which you have little real control or say when all you really want to do is ship something cool.

4. You don't have a real say in your boss.
Although who you report to is negotiated during the acquisition, things may change rapidly at the acquirer.  Suddenly you may find yourself working for someone you never anticipated.  This person may be amazing, or they may be a semi-incompetent early employee that the founder still trust years after that persons proper expiration date at the company.

5. You run into (unnecessary) process.
Part of being at a startup is the ability to be nimble, make decisions, and just do stuff.  At a larger company there may be endless launch reviews, design reviews, and review reviews.  This can be frustrating to someone used to moving fast.

How To Survive To Your Cliff (And Beyond?)

1. Realize that your feeling are normal.  
Most founders go through a period of adjustment when they are acquired.  The first year is typically the hardest part as you adjust to all the changes.  Realize and accept that this is normal.

2. Get engaged with the culture.
Join the acquiring companies running club or community service day.  Get to know other people at the company and encourage the people on your team to do the same.  As you make friends at the acquirer you will find your happiness increase.

3. Be patient with your career and influence.
As you get to know the executive team of the larger company your influence will grow.  Realize that people need to get to know you and trust your insights before asking for your opinion on key items.

4. Get a hobby.
Founders often throw themselves entirely into their work.  But at a slower moving company this is hard to do and you may find yourself with an excess of free time.  This is a good opportunity to get back in shape, take a class in something, fix your house, or otherwise get re-engaged with life while still doing a great job at the acquirer.

5. Enjoy the standard benefits.
Larger companies have much better benefits.  They also have more momentum, so they absence/presence of any one person matters much less.  Some acquired founders adapt quickly to the new cultural mores of long vacations or decide to have a child once they are acquired.  They have more free time, their day to day has less direct impact on company survival, and the benefits are much better.

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