An acquisition is a team sport

When I started my business back in 2008, I had ambitious goals to build a thriving specialist technology PR and video production agency. I knew that there were many routes to growth, but I was particularly interested in accelerating our growth by acquiring niche agencies with specialist teams and interesting clients.

What I didn’t realise was how hard it actually is to acquire another agency.  I ended up having discussions with more than ten founders, CEOs or managing directors who were interested in merging into another agency, but when it came to the details, we just couldn’t find a deal that worked for both parties.

Then we had a breakthrough. I had had my eye on a specialist science and engineering PR agency for quite a few years when I met with the founders and we discussed the possibility of an acquisition. And within five months we had completed a deal. It felt like a huge achievement - giving our team a boost, increasing our revenue and providing opportunities to expand our reach into a new sector for us. A year later, we have successfully merged the two businesses and we are delighted with the outcome.

While I would certainly deem the acquisition a success, the process was also tough and a huge learning curve for me. I survived, and even enjoyed it, but I couldn’t have done it without the support of a few key people. Based on my experience, these are the key people you need in your life to get through a successful acquisition alive:

A corporate finance specialist with expertise in your industry

When you are buying a business, you need someone objective on your side, who can help you value the business you are acquiring and identify how much additional value it could add when combined with your business. It’s also essential that they know your industry: different markets use different methods to value businesses. It’s useful if they’ve got experience with similar deals: they’ll know in advance what might go wrong, and they can introduce you to other professionals who might be able to help. We worked with an excellent consultant who had sold more than 10 other companies in our sector.  He could easily spot red flags, and I could really trust that his advice was based on solid grounding.

An amazing management team

I completely underestimated the amount of work that would be involved in buying another business. In the month before we closed the deal, I was spending more than 80% of my time on due diligence, meetings, negotiations, and creating the post-acquisition integration plan. That meant I had to step back from many of my other duties as CEO. Fortunately, I had a really strong management team that stepped up, and kept the business running.

A solid negotiator

Even if you think negotiating is one of your strongest skills, it’s always worth bringing in an independent third party to handle negotiations on your behalf. They will take emotion out of the process and be a really good sounding board for you. Our corporate finance specialist doubled as our negotiator and it really helped to protect the professionalism and integrity of the entire process.

A knowledgeable and practical HR specialist

When you acquire a business you need to merge their team into yours. That might mean redundancies, office moves and new roles. It can be an unsettling time for everyone involved, and if you don’t handle it delicately you risk causing unnecessary distress and losing key team members. We were lucky to find a really practical HR specialist who knew the law inside out, but was also able to help us navigate some of the challenges that come with merging teams.

An admin superstar

There is  a considerable amount of admin when you go through this process: paperwork that needs to be signed; offices that need to be integrated; decisions that need to be made about furniture; new payroll forms; keys that need to be cut; bank accounts that need to be closed. Without the support of a solid and reliable administrator, chaos would surely ensue. We were lucky to have an efficient administrator on our team who handled everything confidentially and professionally.

A lawyer you trust

Our lawyer worked through the night to get the deal across the line. But he covered all the bases and was extremely thorough in getting the contracts ironed out. He also handled the negotiations around some of the details of the contracts. If he hadn’t been so dedicated, things could easily have gone wrong.

A supportive family

Towards the end of the deal and during the first six weeks of post-deal integration I needed to work long hours to get everything in order. I needed extra help with childcare and extra understanding from my partner when I had to cancel my own birthday dinner. I was also heavily pregnant at the time so I needed to manage my stress. I was lucky to have lots of support at home.

An operations whizz

Even though an acquisition feels like the most amount of work you will ever have to do in your life, you’ll soon find that once the deal completes the real work begins! I brought on a specialist consultant to manage the office move, get all our new team members onto our payroll, cancel old subscriptions, migrate servers and emails, throw a team-building celebration and a thousand other things that all suddenly seemed urgent.

An acquisition offers an excellent route to build your business. But they are hard work too – and definitely a team sport!

 

By Heather Baker, CEO, TopLine Comms and TopLine Film