Reporting from TechNW: If you’re looking to sell your startup company to Microsoft, Facebook, Google or Salesforce.com, you might be better off taking a low-key, subtle approach rather than trying to knock down the front door. After all, as Ryan Aytay, vice president of corporate development at Salesforce.com likes to say, you don’t typically walk up to someone and say “let’s get married. ”
“There’s a window, and sometimes the window closes completely and sometimes it stays open for longer periods. Timing is everything in a transaction,” said Aytay, speaking at the WTIA’s TechNW event in Seattle today. “You want to be transparent … you just need to be careful in not doing it too aggressively.”
In fact, Amin Zoufonoun, director of corporate development at Facebook, stressed that startup companies typically aren’t packaged up and sold. And, he too, used the marriage metaphor to stress the importance of delicate courting in the M&A process. “It is very akin to a marriage,” said Zoufonoun, adding that it really is about the proper matching of two independent cultures.
Moderator Tom Huseby started the chat by running through the acquisition numbers of the panelists’ companies over the past few years, pointing out the dozens of companies and billions of dollars they’ve spent.
The venture capitalist jokingly ripped Microsoft, pointing out the software giant’s lack of M&A activity in recent years, selfishly pointing out that he’d want the company to get more active in order to buy some of his portfolio companies.
Even though Microsoft made a key strategic move with its acquisition of Skype, Huseby said that the company is the most predictable of the bunch. “Microsoft is more predictable, but it almost because you haven’t moved, so I know you won’t move,” said Huseby to laughs from the crowd.
The speed at which deals are getting done also has accelerated. Huseby seemed surprised when Google’s Neeraj Arora noted that acquisitions can take as a little as two weeks to complete.
“Does anyone believe him?” Huseby asked the audience. That started a bit of one upsmanship, with each panelist talking about how quickly they’ve pushed forward transactions. Facebook’s Zoufonoun capped the competition by saying they’ve done deals in a few days.
Some of those acquisitions are on the pure talent front, an area where Facebook has made some moves in recent months. (For example, its purchase of the team at Seattle startup Rel8tion is a good example).
Facebook’s Zoufonoun said they’d likely do more of those style of deals in the future. But they aren’t quite as interesting to Microsoft. “Talent is a huge part of every acquisition, but rarely is it the only part,” said Ryan Cooper, director of corporate development at Microsoft.
All of the panelists discussed the importance of retaining talent post-acquisition, a challenge for big companies. Salesforce.com’s Aytay said some of the employees who’ve joined through acquisitions have risen to positions of prominence within the company.
Most of the panelists agreed that investment bankers can be a helpful part of the acquisition process. Salseforce.com’s Aytay said that bankers can serve a vital role in “greasing the skids” and, perhaps more importantly, talking “sense into an emotional CEO.”
At one point during the conversation, Huseby turned the tables on the panelist and asked the rivals if they had any questions for one another.
“Let the record state, we’ve discovered the reason why no one does this,” said Huseby.
More silence, and laughs from the crowd.
Finally, Salesforce.com’s Aytay asked Microsoft’s Cooper when they plan to do their next deal.
“Soon,” said Cooper.