Lessons on M&A from 3 Successful Founders

A few weeks back as part of season 2 of the Travel Tech Insider Pod, Cara Whitehill and I released a short series of conversations about M&A. As I've often said, the M&A experience suffers from the law of small numbers. Even the most successful founders will only have a small handful of M&A experiences in their careers and most people will never be close enough to the details of an M&A transaction to have any first-hand experience. Further, even for buyers M&A is rare and deals can be so different from one another that it isn't always easy to compare Apples to Apples and to turn your anecdotes into trustworthy data.

Thus almost everyone engaged in M&A is flying blind.

To dig deeper into this topic check out our first conversation with the folks with the most experience in M&A, the Bankers, and then the second episode with 3 outstanding Founders.

But even with all of this great content there were still some amazing insights left behind and I want to highlight just a few of them here. ?

Jeroen van Velzen spoke beautifully about his philosophy of putting the Traveler as your top priority; which sadly doesn't always happen due to the transactional nature of our industry. He complemented that by highlighting the critical task of taking care of employees so they can properly take care of the travelers. This is something all good CEOs think about but don't always speak about publically.

The most critical insight from Jeroen was his discussion of going from being a Founder to being a Manager; or what he called 'Managerial Mode'. He described going from being a founder and building things to being in 8 hours of meetings each day with no room to create. Most founders really underestimate and do not fully consider how much their roles will change post-exit and if they will enjoy and thrive in these roles.

This wisdom is perfectly coupled with Sarah Dusek s experience of losing control post-exit. Sarah eloquently shared her experience of waking up about a year after the deal closed realizing that she was not in charge anymore and that new owners always put their own spin on things. As she said, they will redecorate your beautiful kitchen. ?

All of our guests talked about the critical work of creating a clear post-transaction integration plan. Sam Shank specifically mentioned that this type of plan is perhaps the biggest single factor to post-M&A integration success; especially when keeping employees in mind.

One macro observation is that while none of our guests did the traditional thing of hiring a banker to run a full process at the time of sale, all 3 of our guests already had bankers and folks with deep M&A experience around the table. This echoed what we heard from the bankers about the value of having preexisting relationships. Additionally, and close to my heart, all 3 of our guests also talked about the great value their Board of Directors provided during their M&A efforts.

Lastly, we heard loud and clear from both the bankers and founders that the best time to sell your startup is during a period of rapid growth. This may sound obvious but it is actually very counterintuitive in real time. During periods of rapid growth, no one wants to sell. The founders are high on the excitement from this period of rapid growth, investors finally see the metrics they have been dreaming of, and the team seems to be firing on all cylinders. But this is when a founder, supported by their Board and outside Advisors, needs to sober up and realize that M&A (like all things in startup land) is all about a story and the story is always most exciting during periods of rapid growth; before the growth rates slow ... as they always do at some point.

There is so much more to learn from these amazing founders so please listen and share your favorite takeaways.

Full episode list - https://traveltechinsider.buzzsprout.com/2283730