Many business owners are aware of the obvious aspects of mergers and acquisitions, but there are some less well-known factors associated with most mergers and acquisitions, that you might be interested in knowing.
Here are some of those lesser factors associated with mergers and acquisitions
Mergers and acquisitions are long-term
Most mergers and acquisitions have at least a 2 to 3 year retention. With vesting and re-vesting programs, as well as 2 to 3 year earn-outs, the process always extends two or more years into the future. If your company gets acquired, you can pretty much count on being committed to the buyer for the next 2 to 3 years.
Conditions are always changing
The conditions which make you appealing as a merger or acquisition partner today may be completely different in 6 to 12 months. In addition to that, priorities often change for those companies in the market for mergers and acquisitions. When the opportunity arises, it’s best to strike while the iron is hot, because that may be the only opportunity that ever comes up.
Who actually acquires startup companies?
There are literally thousands of mergers and acquisitions which would make strategic sense for a great number of companies, but that’s not how mergers or acquisitions are carried out. Instead of gauging how much strategic sense it would make for a company to make a move on another company, a merger or acquisition is most often conducted because a CEO identifies a strategic gap in the future, which could be satisfied through merger or acquisition. In other cases, a company executive identifies a way to quickly accomplish something over the next year or so by acquiring another company.
Mergers with Flex Capital
Thinking of conducting a business merger or an acquisition, but you lack the funds to pull it off?
Contact us at Flex Capital, so we can explore some options with you for financing your merger/acquisition, so you don’t have to miss out on a golden opportunity for your business.
