Unlike traditional finance or consulting paths, an entrepreneurial background provides a unique "superpower" in corporate development. This experience fosters an operator's perspective, a better understanding of founder motivations, and a natural bias toward using M&A to accelerate growth.
When pursuing a distressed company, understand the investors' intrinsic motivations. They often prioritize avoiding a public failure and protecting their reputation with LPs over recouping sunk capital. Frame the deal as a success story for them, not a fire sale.
Instead of jumping directly to an acquisition, de-risk the process by first establishing a partnership or licensing agreement. This allows you to test the technology, cultural fit, and market reception with a lower commitment, building a stronger foundation for a potential future deal.
Once a deal reaches the final stages after extensive vetting, the team should operate under the assumption it will close. This mental model prevents deal fatigue and endless second-guessing, focusing energy on overcoming obstacles rather than searching for reasons to kill the deal.
A five-step framework—Deep Dive, Battle Test, Communicate, Run Funnel, Commit to Close—is designed for smaller companies to execute M&A with focus and agility. It emphasizes using a firm but flexible framework over a rigid, step-by-step playbook.
Don't treat your M&A strategy as a state secret. Proactively sharing a detailed deck with bankers and trusted advisors multiplies your sourcing capabilities. This transparency ensures the inbound opportunities you receive are better aligned with your strategic priorities.
Do not wait until a deal is closed to engage the integration team. The Post-Merger Integration (PMI) function should be formally established the moment an LOI is signed. This gives them a front-row seat to audit cultural fit, validate the deal thesis, and plan for practical execution from the start.
In the current AI-driven tech M&A landscape, traditional valuation metrics are being upended. For high-potential companies, the exit multiple is sometimes calculated based on total capital raised (e.g., 10x) rather than annual recurring revenue (ARR), signaling a major shift in valuation.