

Thoughts on Acqui-hires & Soft Landings - olivercameron
http://daslee.me/quick-thoughts-on-acquihiressoft-landings

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asanwal
I don't fully understand acqui- hires especially points like this "For
example, don’t be afraid to say “I’ve raised $X dollars and my investors are
looking for a 2x return.”

If the company is flatlining, why arent acquirers just poaching talent and
paying no regard to investors? Why is investor return on a product/service
that the "acquirer" will not support or that they don't even care about part
of the equation?

Is it because acquirers don't want to alienate investors who may have great
cos for them in the future? That's what I've heard but that seems like a soft
justification to me. There is a much smaller pool of acquirers than investors
so while an investor might not be happy with an acquirer poaching from his
prior portfolio company, it doesn't seem they'd walk away from a future
acquisition if the economics made sense.

Genuinely curious as to logic of acqui-hires from the acquirers perspective as
the conversation suggests investors have some leverage in these discussions
when it seems logically that they'd have none.

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jandrewrogers
Some of the acquirer's considerations for acquiring rather than aggressive
poaching are mitigating potential for lawsuits and making it easier to get key
employees and founders who _are_ worried about their reputations in the tech
business and might otherwise be un-poachable. Also, it makes it easier to
capture most of the employees since every other company will aggressively
recruit from the startup once rumors of the startup's imminent demise start
circulating.

From an effort, risk, and cost standpoint acquisition may actually be cheaper
than wholesale poaching while allowing most people on the other side of the
transaction to save face which may have its own long-term benefits in the tech
business.

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joshu
There are some subtle points in there.

(as an aside, the bar on the left makes it look like a block quote.)

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Danieru
> (as an aside, the bar on the left makes it look like a block quote.)

As does <blockqoute> in the html.

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dataisfun
Thanks David. I agree with these points. Given the founder's priority is for
their team, how do they effectively represent both their team's interest and
the investor's interest to the acquirer? In a tight situation, who gets the
preference and how much?

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diego
Why do you take it as a given that the founder's priority is the team? As a
founder you have different stakeholders. Perhaps your investors have been with
you for years and your team just joined, or the opposite. Like the article
says, you can't generalize regarding the employees.

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kenko
"For example, founders who don’t think of their team’s welfare first in a soft
landing probably won’t get funding from their prior investors."

So in this context, a founder's "team" is the investors, yes? Not the
employees?

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akkartik
I see no reason to think so. The article uses both 'team' and 'investors'. No
reason to think the writer is disorganized.

It also says in a soft landing 'investors basically get no money back.' So the
only concern seems to be how the team is treated.

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adharmad
So where do customers and early adopters fit into this whole thing?

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jusben1369
This was interesting and helpful. It wasn't clear though how much this was
directed at Acqui-hire vs Soft Landing. It seems most of it was Soft Landing
focused?

