The Acquisition Playbook: Strategies That Actually Work

My experience on both sides of the acquisition table has taught me that successful acquisitions follow predictable patterns. Here's a playbook based on deals I've been involved with:

Strategic Positioning Before You Sell

The groundwork for a killer exit starts long before you start fielding offers:

Decrease Founder Dependency: If your business collapses the minute you step away, you don't have a business—you have a job. Build systems and teams that can run without you. During my time at The LAB Miami, Goldman was particularly concerned about community continuity when I decided not to continue (will get more about employee contracts)—anticipating this concern, we had already documented our community-building practices and trained multiple team members to maintain these relationships.

Upgrade Your Revenue Quality: Recurring revenue is the gold standard. If you're not there yet, start shifting. For a service business I advised, converting project-based clients to retainer arrangements increased their multiple from 2.5x to 3.8x EBITDA.

Craft a Growth Narrative: Buyers aren't just purchasing what your business is today; they're betting on what it will become tomorrow. During my work with Avia before their acquisition by Altus Spine, demonstrating the pipeline of innovation and market expansion opportunities secured a valuation that traditional metrics wouldn't have supported. It helped that they were our main manufacturer.

Buyer Matchmaking: Finding Your Perfect Match

Different buyers value different things, and understanding this is acquisition alchemy:

Strategic Buyers: These companies buy for synergies with their existing business. The Avia acquisition by Altus Spine exemplifies this approach—Avia's innovation complemented Altus's manufacturing capabilities, creating value neither company could achieve alone.

Financial Buyers: Private equity firms and similar investors focus on stable cash flows and growth potential. During my time at The LAB Miami, when it was acquired by Goldman, their primary concern was the financial projection model and scalability across markets outside of Miami.

Individual Buyers: Often SBA-backed, these buyers want stable, established businesses with manageable complexity. For a Cycle Bar where I was the loser and didn’t get the deal (damn you cash buyer), the acquisition was through an SBA loan, demonstrating that reliable cash flow and manageable operational complexity were crucial.

Matching a business to the right buyer type isn't just about maximizing valuation—it's about ensuring post-acquisition success. The WUN and Yardi merger I observed succeeded because both companies recognized the value in maintaining WUN's operational independence through a new division called KUBE while leveraging Yardi's resources.

Matching a business to the right buyer type isn't just about maximizing valuation—it's about ensuring post-acquisition success.

The Timeline: Managing Expectations (Yours and Theirs)

Acquisitions rarely happen overnight. Here's the reality check:

Preparation Phase (3-6 months): Get your data room tight, optimize operations, and mentally prepare for the rollercoaster. We spent four months cleaning up financial reporting and documenting customer relationships before approaching potential buyers.

Marketing Phase (2-4 months): Start approaching potential buyers, distributing teasers, and signing NDAs. When helping sell a manufacturing business, we approached seven potential acquirers, ultimately receiving three letters of intent.

Due Diligence Phase (2-3 months): This is where deals go to die. The key here is anticipating questions and preparing detailed answers to over 200 likely due diligence questions, significantly accelerating this phase.

Closing Phase (1-2 months): Even when you think you're at the finish line, expect unexpected hurdles. In my experience, this phase often uncovers unexpected complexities—budget time accordingly and get a great attorney and accountant!

Post-Acquisition Integration: Where the Rubber Meets the Road

The success of an acquisition ultimately depends on what happens after the champagne bottles are empty:

Preserve What Works: Smart acquirers know not to break what isn't broken.

Communicate Like Your Deal Depends on It: Because it does. Uncertainty breeds fear, and fear drives key talent out the door. Weekly integration meetings for the first three months, addressing concerns directly and celebrating early wins.

Score Quick Wins: Find immediate synergies to build momentum. In the WUN and Yardi merger, I observed, they quickly integrated their sales processes, demonstrating value to both organizations within the first 60 days.

Maintain Stability: Resist the urge to change everything overnight. When helping a service business through acquisition, we maintained existing client service processes for six months before gradually implementing improvements.

Whether you're selling your startup or looking to buy one, you'll need money, and that means pitching. Here's how to nail it in 180 seconds:

The 3-Minute Acquisition Financing Pitch