Getting acquired is a major milestone for you and your business. It’s been a long road to get your company to this point, and you’ve probably been focused on the tangible elements: proposals, dollar values and signatures. While there are many helpful tips online that cover topics ranging from the necessity of clean document preparation to investment theories and threshold issues, what can typically get lost or deprioritized is the people aspect of acquisitions. During this sensitive time, it’s crucial to exercise your soft skills on the people who are most affected by the big news. To help ensure a smooth transition and minimize negative business impact, here are the three important relationships to manage as you navigate your acquisition.
1. Your new executives
Relationship-building with your new parent company’s top-level team begins with the due diligence process, and then takes off after the papers are signed. Approach both phases with transparency and accountability, and you’ll be paving the way for success. For me, face-to-face time was crucial prior to the recent acquisition of Audiobooks.com by RBmedia. Our new executives flew out to Toronto for meetings -- sometimes even just to share a meal -- which helped establish a trusting foundation right from the beginning and made it easy to have honest, open conversations.
Post-acquisition, I focused on information sharing and setting expectations. Have a visioning meeting to map out your five-year plan and goals for the first 12 months. Review immediate changes to budget, departments and business processes. Establish the regularity with which updates and reports are due, frequently assess KPIs to show how you’re pacing and set a schedule for management conference calls. When everyone’s clear on goals, strategy and deliverables, your relationship to your new executives will feel rock-solid.
2. Your existing team
Knowing when to communicate what to your team is the hardest but most crucial aspect of managing your employees’ pre- and post-acquisition experience. Pre-acquisition, I found it most effective to communicate only when necessary, and keep the information to a minimum. There are too many unknowns at this stage, and oversharing without really knowing what’s going to unfold may lead to empty promises and incite panic among staff. I answered questions when necessary and I never lied, but I managed rumors with upbeat opacity.
Post-acquisition, tell your team what’s going on as quickly as possible, making sure you’ve considered things from their perspective and anticipated the questions they’re going to have. Know what’s changing with health insurance, vacation policy, office space and employment security before broadcasting the news. You don’t want your best talent (part of the reason your new parent wants to acquire you!) to flee because they’re worried they won’t have a job in a few months. I made sure to hammer out the fine details about exactly what the acquisition meant for my team before breaking the news, which kept morale high and avoided confusion.
3. Your business partners
Chances are your business partners played a big role in growing your business to the point that someone wants to acquire it, so honor their contribution with open communication. Your partners are not going to want to find out about your acquisition via the rumor mill -- or worst case, via the news cycle -- so set aside some time to contact each of them as personally as possible, both before and after the acquisition is finalized.
Be prepared to answer their number one question: What does the acquisition mean to them? When I was reaching out to Audiobooks.com’s business partners to discuss our upcoming acquisition, I also used it as an opportunity to touch base on all aspects of our partnership. Even if your acquisition won’t change much, a phone call will go a long way to show that you value and respect them, and they will appreciate the courtesy of a heads-up.
Acquisitions are equally exciting as they are stressful, so to shift the balance of emotions in the right direction, it’s vital to prioritize having honest and empathetic conversations with everyone impacted. With effective communication to all stakeholders -- new parent, existing team and business partners -- navigating an acquisition really can be pain-free.