
Ask HN: Costs of acquiring a company? - fizzyfizz
My company is considering acquiring another company.<p>One of the people tasked with deciding this seems to have no concept of integration costs. He thinks that we just grow our team by 2x and then we&#x27;re 2x more productive. Even though their technology stack is on JVM languages, and ours is Python-based.<p>My experience is that this is totally underestimating the costs of integration, but are there studies to back this up?<p>(Let&#x27;s set aside the coordination costs of a larger team -- we can refer to the Mythical Man-Month for that).
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mswen
The integration issues will clearly be very different if the
engineering/programming teams will be co-mingled and working on the same
product. If they will be combined to work on a single unified product then you
are right there will be significant integration costs.

On the other hand if you are buying a company with a product that will
continue and the "integration" is at a higher level of abstraction the
integration might not be so bad. Support each product on their own stack and
integrate at the API level.

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gravypod
The largest cost stems from taking someone else's "baby" away from them. The
truth is if you can make the other CEO understand that their company is only
worth as much as someone is willing to pay.

If they are leaking money, if they have no clients, if they cannot capitalize
know their invention: let them no and tell them that you are the only way out.

It might not be true, but if you don't want to spend way more then what it's
worth, you will need to tell them.

