Time Required for an Acquisition

A good friend of mine is walking through their very first acquisition and the numbers that he’s working with are 7-figures.

Naturally, the excitement was pretty palpable as the thought of living completely debt-free and all the other benefits of a large buyout turn from fiction to reality.

But that excitement doesn’t always stay that high for that long and he realized that really quick as he began moving into the “due diligence” phase where the nitty-gritty of an acquisition comes into play.

After having walked through a few of these myself we’ve chatted weekly about the progress and I’m very happy to help (ecstatic, actually) as a neutral counselor and sounding board.

But the challenges of such a large deal are beginning to take a toll on the excitement and his emotions as this period of diligence can, at times, totally derail the real work that still needs to get done.

The biggest challenge with any acquisition is the time required to pull one through to completion (legal, accounting, and more…). As a consequence, the aggregate time can more than just distract the actual business and the emotional/psychological cost can become completely disarming.

In fact, it can become so draining that a founder(s) thoughts about the acquisition itself (and the amount of money) can turn sour and it can feel as if the effort is not worth the payout.

I know this all too well as negotiations for one of my previous ventures took a little more than 13 months. That’s over a year of deliberation, study, and most importantly, distraction.

Ugh.

Most first-time founders and startup leaders have no idea how long it can take for one of these deals to be brought to completion and it’s quite possible that you’ve been “courting” these interested parties for even longer.

There are very few things you can do, though, to avoid the mental and emotional drain and everyone handles it differently. The most helpful advice is two-fold:

  1. Focus on the business. Do whatever you can to not become distracted.
  2. Get outside help, counsel, coaching, mentorship, whatever from those that have done this before. There’s no reason why you can’t have multiple people with no financial ties review the offer(s) and give beneficial advice.

That’s about it.

I wish him the very best and I’m rooting for him strongly on the sideline. Besides, he’s promised me dinner when all is said and done and I know a killer sushi spot that’s amazing (and not that cheap…). I think he’ll be able to afford it.