The foundation of a new M&A function is deep internal alignment. Before looking outward, the first month should be dedicated to interviewing internal product leaders and SMEs to understand the business, product roadmap, and strategic direction from the inside out.
In high-growth phases, M&A should accelerate product development, not find new growth engines. Start with small team/IP acquisitions to build the internal capacity for integration. This de-risks larger, more strategic deals later as the company matures and its organic growth slows.
The biggest risk after closing a deal is losing momentum. To ensure success, Snowflake assigns a 'Directly Responsible Individual' (DRI) for integration. This person leads reviews at 30, 60, 90, and 180 days post-close to hold everyone accountable to the integration plan and original thesis.
Don't surprise an acquired company with an integration plan on day one. Snowflake turns diligence into a collaborative process post-term sheet. They work with the target's leadership to jointly build the integration thesis, define milestones, and agree on charters, ensuring buy-in and alignment before the deal is even signed.
A robust M&A strategy isn't built in a vacuum. Snowflake's CorpDev team continuously gathers intelligence from three sources: VCs (capital flow), entrepreneurs (innovation), and internal product leaders (strategic needs). This triangulation allows them to form a holistic and actionable market view.
Snowflake views its corporate venture arm as an ecosystem-building tool. Investments are strategic capital to fuel partners who drive consumption on their platform. This creates a win-win-win: Snowflake gets more usage, customers get more value from their data, and startups get go-to-market acceleration.
Beyond customer metrics, Snowflake’s corporate development lead looks for three key founder traits: hunger, hustle, and humility. Humility is especially critical as it indicates a founder who can appreciate other perspectives and engage in constructive debate, even while maintaining strong conviction in their own vision.
Instead of demanding a controlling 'Right of First Refusal' (ROFR), Snowflake's venture arm uses a softer, more founder-friendly 'Right of First Notification' (ROFN). This doesn't block other offers but ensures they get a heads-up before an exclusive deal is signed, giving them a chance to participate.
Assessing cultural fit can't be done in a formal, time-crunched diligence process. Snowflake approaches M&A like dating, building relationships with companies over time. This long-term engagement allows for genuine discovery of values and operational style, de-risking the 'cultural diligence' aspect of a potential acquisition.