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Make Your Own Luck and Get Acquired You could be the next Whatsapp if you stay organized and prepared with these tips from SXSW.

By Jacob Hall

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

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The first thing to know about getting acquired? There's no one route. In fact, at their SXSW panel in Austin, Texas, "The 5 Secrets to Getting Acquired," HelloWorld chief executive officer Matt Wise and Gabe Karp of Detroit Venture Partners opened their presentation by saying that there are no secrets. Says Wise, "The majority of people who get acquired are dumb lucky and many are just dumb."

That said, there's still a lot to be learned, especially from this duo. HelloWorld is a mobile engagement platform that's been involved in 6 acquisitions in just the past 2 years. Karp hails from a Detroit-based VC firm with the ambitious goal of rebuilding that shattered city through seeding new tech companies. Here are their tips for how you can make your company look appealing for a buy.

1. Get your team in shape. Great ideas are common, says Karp. "The rarity is the person with the team to make it happen." From an acquirer's point of view, Wise says, he never buys a company for its product: "I'm buying the team." It's vital for young entrepreneurs to recognize their skillsets and hire employees to make up for their gaps. Wise recalled being impressed with a company once because one partner had designed missile intercept software: "He must be smart! He shot down missiles!"

2. Hone your soundbites. If you get 20 minutes into a pitch and the acquirer doesn't know what your company does, you're in trouble. "We've sat through many presentations where we have no idea what they're saying," Wise says. Speaking in catchy soundbites is great for clarity and brevity -- acquirers aren't always experts in your field and they don't like having their time wasted. Something brief and memorable will work wonders during the closed-door meetings after your initial conversation. "What are they going to tell their partners in 30 seconds?" Wise says. The snappy, clear and quick pitch, of course.

3. Be appealing. Take only your most charismatic people to your most important meetings. Your partners might be brilliant, but if they are unsociable or downright strange, it can put business deals in jeopardy. "They have to live with you," Wise says. "If you're emotional or irrational, it's done." Of course, your company itself needs to be appealing. "Acquirers don't want to see a strong profit margin early on," Karp says. "They want to see a model that will be profitable at scale." No one wants to buy you for what you are today -- they want to buy you for what you'll be tomorrow.

4. Get your sh*t together. In the panel, Wise recalled a time when a few small discrepancies in a company's financial history almost killed a deal and even slashed its asking price. "The moment the perception [about you] changes, the purchase price changes," he says. Wise adds that the landscape can be brutal and the smallest bumps hurt. "It's tremendously unfair, but it's a reality," he said. Being organized, informed about your industry and ready to withstand high levels of scrutiny is what gives comfort to investors.

5. Go make friends. In the end, it all comes back to connections. "It is hugely important how you network," Wise says. Be prepared to build relationships over months (or even years) before you plan to sell and plant the seeds you hope to sow. If you are careful not to push too hard and create the right connections, you'll make friends in the right places. One day, one of those friends will call you to check on your progress and only later will you realize that they want to make an acquisition. Wise agreed: "Get an understanding of what they're looking for and get on their radar."

Jacob Hall is a writer living and working in Austin, Texas. He writes about movies, books, games and technology.

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