I’ve had a chance to semi-objectively watch a number of folks go through the M&A process over the past 18 months, and compare and contrast their experiences with mine.
Some acquisitions thrive. YouTube, PayPal, Android. Others of course die. GeoCities, Broadcast.com. Perhaps most actually meander in the middle. Flickr.
Take a look at this interesting chart on Google’s acquisitions from ArsTechnica: in fact most acquired companies/products do survive and make it, at least for quite some time, if they pay for themselves, at least at Google:
But let’s put the products and companies aside. Let’s talk about people. What it will take for you, and those on your team, to make it post acquisition.
There’s one thing I’ve learned at the people level, why people don’t thrive after acquisitions (assuming they still want to succeed): they can’t, or won’t, move from Persuasion as their way to drive decisions and change — to Alignment.
What do I mean?
Well, in most start-ups, even when you get pretty big … here’s how senior leaders Get Things Done:
- Identify a problem, an opportunity, or something that needs to change; then
- Get together the key players, physically, or by email, or whatever; then
- Explain their position, with data and experience. Convince the rest. then
- After convincing, new path is agreed upon.
- And this is the key part — once everyone is convinced — then everyone in a start-up just goes out and executes on that new path. They just go do it. (Yes, probably with prodding by the CEO and all that — but they go do it). Both because that’s what you do in a start-up … and also because everyone is on the same team, with the same goals.
The thing is, in the BigCos, those last 2 points don’t really happen naturally the way they do in start-ups, at least if some of the stakeholders aren’t your direct reports, and especially if they are in different departments. There’s too much risk to think through, in brand, in budget, in opportunity costs. Also, people in BigCos just don’t go execute on the new path. They don’t report to you, they are in different departments, and they have their own priorities. So they wait until they are told to act. Even if you’re right and everyone agrees you are right. In fact, it doesn’t really matter if you are right, until you achieve Alignment.
So the senior start-up people that are most frustrated post-acquisition … they make great arguments … pretty much convince everyone they’re right, or at least that action needs to be taken … and then beat their heads against a wall when nothing happens after that.
“Is everyone so stupid?” these frustrated, post-acquisition employees think?
No, they aren’t. In fact, the senior folks in every tech BigCo are probably just as smart and most likely smarter than you (after all, they’ve gotten further than you in most cases). Though of course, they aren’t as smart as you in your domain.
The problem, such as it is — is that you have to learn the skill of Alignment. I know it’s an annoying concept if you haven’t had to live it. Call it Politics, if you must. It’s getting everyone at a reasonably senior level to go along with the New Path, or a different path than they are planning to go down. It’s almost like guerrilla warfare, and you have to do it stakeholder-by-stakeholder, both 1-on-1 (to gain support) and then again in larger forums. Probably, again and again. And again.
This takes a lot of time. You likely will even have to convince people who don’t care at all about your product or what you’re doing. And you’ll have to find a way to get people to do things for you that don’t report to you.
It’s a hard skill to learn, especially when you’ve had success doing things your way (after all, this is why you got acquired). Most start-up execs lack these skills unless they came from a BigCo at a reasonably senior level.
But you need to learn it, Alignment, if you get acquired. Or at least, help your team learn it.
I’m proud of how we did after our acquisition. I had some good, early success in Alignment, especially around maintaining our proven sales strategies. You can see the results below:
But it is hard, learning Alignment — and practicing it. Making that change is hard. I wish I’d done a little better job at it.