M&A involving startups

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    Terry Koh

    Many times, a startup is successful and valuable because of its founder or founding team who has the drive and vision to lead the company. In the event where the founder cashes out and leaves the company upon successful acquisition by a bigger company, will the existing company then be able to remain competitive due to a change of leadership.



    I think that depends on the success of the integration. On one hand, if the integration goes well and the culture is intact the business should be able to remain competitive. On the other hand, if the integration went badly, the cultural shift was too great, and the turnover of employees was greater than expected you could run into issues. However, those issues could be temporary until everyone adapts to the changes with the integration.

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