Successful founders prioritize cash upfront over potentially larger payouts from complex earnouts. Earnouts often underperform because founders lose control of the business's future performance, leading to dissatisfaction despite a higher on-paper valuation.

In M&A, the closer you get to closing, the more emotionally invested you become, even mentally spending the money. This attachment makes founders vulnerable to accepting last-minute unfavorable changes because they've already "emotionally bought in" and moved on from owning the company.

An acquisition target with a valuation that seems 'too good to be true' is a major red flag. The low price often conceals deep-seated issues, such as warring co-founders or founders secretly planning to compete post-acquisition. Diligence on people and their motivations is more critical than just analyzing the financials in these cases.

An acquirer pursued a small accounting firm for 12 years. The owner was always interested but never ready to sell. By the time the deal finally closed, the business had significantly declined in value due to client attrition, costing both the seller and the buyer potential revenue.

To compete with top-tier firms, other VCs are using aggressive deal structures as a weapon. This includes offering huge secondary sales or other founder-friendly terms that might not be in the company's best long-term interest, simply as a tactic to win the deal at all costs.

VCs who demand an immediate signature are often taking advantage of impressionable young founders. Browder advises against this, instead giving founders the night to think. He still expects a decision by morning to maintain decisiveness.

A deal with two founders was about to sign when the less-committed founder hired an independent valuation firm. The firm provided an unrealistically high valuation, which he used as justification to kill the deal. Acquirers should address founder reluctance early, as emotional attachment can override a logical deal process.

For companies that are not generational outliers, the first serious M&A offer is usually the best one they will receive. Lair Hippo's philosophy is that founders should take these initial offers extremely seriously, as trying to run a lengthy process often fails to produce a better outcome and risks the original deal.

The reality of selling a company is not a simple transaction. It's a grueling, months-long process that functions as a demanding second job for the founder, who must keep it secret from their team while simultaneously running the core business at full capacity.