“1. Big buyers are bullies: Large tech companies exert negotiating power over founders and selling companies because they can, and stack the deck in their favor with buyer-favorable terms.”
Well duh. Gravity is a bitch. What else is new.
The problem is more like: most tech companies that get acquired by “big buyers” have less than $10m in annual revenue. There is very few competent advisors in this space because most tech M&A advisors work for boutique investment banks where $1m is the minimum acceptable fee. Hence founders genuinely do not know if a 30x revenue or a 3x ebitda is a “great offer”
“2. Big buyers get more protection than they need: Many of these terms are unnecessarily one-sided. For instance, buyers hold back a much higher portion of the purchase price to cover potential liabilities than they need.”
Self serving crap. This smells like “we won’t make you make scary sounding reps and warranties so we can pay under market” (see above re: very few founders can tell what a great offer is, which is exactly what Atlassian would prefer).
Well duh. Gravity is a bitch. What else is new.
The problem is more like: most tech companies that get acquired by “big buyers” have less than $10m in annual revenue. There is very few competent advisors in this space because most tech M&A advisors work for boutique investment banks where $1m is the minimum acceptable fee. Hence founders genuinely do not know if a 30x revenue or a 3x ebitda is a “great offer”
“2. Big buyers get more protection than they need: Many of these terms are unnecessarily one-sided. For instance, buyers hold back a much higher portion of the purchase price to cover potential liabilities than they need.”
Self serving crap. This smells like “we won’t make you make scary sounding reps and warranties so we can pay under market” (see above re: very few founders can tell what a great offer is, which is exactly what Atlassian would prefer).