There’s a lot to know when it comes to mergers and acquisitions, and how those can affect both businesses in the process, as well as employees within those businesses. Here are five things you might not have known.

People Buy Startups

It’s commonly thought that businesses buy startups, but that’s not actually the case. The reality is that CEOs and SVPs are the ones who purchase startups, and it’s all about filling a service or offering hole within a larger business.

Time Heals All Wounds

Mergers and acquisitions can be pretty traumatic, at least before they occur and during the process. However, a little time can give perspective. Within nine months, the focus usually shifts off of startup performance and onto other things.

Mergers and Acquisitions Are Changeable

Because the process is driven not by a business, but by an individual, there are lots of vagaries involved. It’s not unusual for things to change dramatically very quickly, even at the last minute.

Hang in There

Once upon a time, talent could leave the merged business as soon as the deal was done. That’s no longer the case. Today, most purchasers expect top talent to stick around, and they expect you to do so for quite some time. It’s not unheard of to require up to three years of retention, or even more in some cases.

Price Is Driven by VCs

You would think that prices involved with mergers and acquisitions would be largely driven by professional valuations, but that’s not the situation. In fact, price is most often driven by VCs (venture capitalists) and sentiment, rather than hard numbers based in fact.

There you have them – five little known facts about mergers and acquisitions. Want to know more? Get in touch with JNI Lending.