2024 is the year every founder think about an acquisition

That doesn’t mean do one, but it does mean think about doing 1 that could move the needle.

Valuations are somewhat down, but more importantly, folks are more rational than they have been in years.

In 2021, no one wanted to sell.  In 2022, no one knew what was going on.  In 2023, it was all about cutting.

2024 isn’t easy for everyone.  But it is a year when everyone is more rational.  This is surprisingly rare.  Take advantage of the vibe to think about if some sort of acquisition could truly move the needle for you, and be possible:

1️⃣ Think about acquiring another startup with an A+ team and/or A+ second product

2️⃣ Think about possibly merging with your top competitor. Hard but can open up interesting dominance opportunities when done right.

3️⃣ Think about possibly merging with a good partner to get to scale. E.g., one of you at $40m and the other at $40m with so-so growth might be meh. But together? You might be able to IPO in a few years.

I’m not saying do any of this for sure.

I am saying 2024 is the right year as founders to think about maybe, maybe doing one of these.  Just one.

As a learning process and thought exercise.  Take a pause and think about the top 1-2 folks you might want to acquire, merger with, etc.

And just have a conversation.  Just reach out.  And talk about if it might make sense to work more closely together.  The math probably won’t pencil out.  Human and cap table dramas are often fierce.

But sometimes, sometimes, acquiring that great second product, or getting to $100m-$200m ARR faster, with faster growth, can be magical.  Take the announcement of Salesloft acquiring Drift, above.  While I don’t have the latest numbers for either, the combined company is likely well above $200m ARR, with solid if not torrid growth.  And so … ready to IPO together.

And this is how ZoomInfo IPO’d and got to $1B+ in ARR, for example.  They went and bought a competitor … called ZoomInfo :).  More on that here:

From $0 to $400+M: 10 Mistakes the CEO of ZoomInfo Made on His Journey to IPO with Henry Schuck (Video)

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