In December 2018, Autodesk acquired PlanGrid for $875 million. I labored at Autodesk, helping in integration for 15 months within the newly fashioned Autodesk Building Group.
Integrating a startup into one other firm is like leaping into freezing chilly water — there may be an preliminary shock to your entire system. As founders, it was necessary that we took care of our crew and ensured our merchandise continued to work nicely for purchasers.
Corporations are purchased; they don’t seem to be bought. Consumers sometimes pursue acquisitions to:
- Achieve market share and improve income and buyer logos.
- Take away a competing enterprise from the market.
- Broaden their product strains and technical capabilities.
- Broaden in-house technical and gross sales experience shortly.
This publish is for anybody who has a signed LOI or time period sheet with an acquirer and is in search of classes realized on navigate the brand new world — what to anticipate and what to keep away from. For people who’re speaking to corp dev, learn this. (For founders who wish to promote their firm proper now: It’s mentally, bodily and emotionally taxing to stay two competing realities — to check two competing futures to your startup on the identical time. Your job is to protect optionality and make all choices (together with working your startup standalone) accessible if you wish to entertain an M&A dialog. Don’t threat slowing down in execution and progress to speak to corp dev.)
Lesson 1: Imaginative and prescient
After an acquisition, most corporations prioritize product integration as their prime concern. In our case, this was true as nicely. Nevertheless, true product integration is usually a prolonged and unsatisfying first precedence, as it will possibly take years to finish if it ever occurs. Until the structure is strictly the identical, and merchandise someway snap collectively properly, the result’s usually a hodgepodge of incompatible merchandise. The most costly problem of specializing in product integration as the principle precedence is that it overlooks extra crucial wants. The highest precedence ought to be establishing and aligning on a shared imaginative and prescient.
Integrating a startup into one other firm is like leaping into freezing chilly water — there may be an preliminary shock to your entire system.
In 2019, we wanted imaginative and prescient from management, and it will not come for a number of quarters. It wasn’t due to an absence of want; there are only a lot of dependencies at a big firm, and it takes time to run any determination up the flagpole.
Within the early days, our groups, income targets, incentives and gross sales processes weren’t built-in. This led to building clients receiving a number of gross sales calls from totally different groups throughout the identical firm, leading to ARR churn and ARR shifting between product strains.
