Looking to get Acquired by a Major Enterprise?

While the initial public offering (IPO) route is still a highly valued exit strategy, startup founders are looking increasingly toward getting acquired by enterprises. This trend is likely due to the simplification of showing value to a single company rather than the public. Additionally, startups that do get acquired by big companies are often able to hold their positions and lead the innovation efforts, something they’re both good at and enjoy doing.

When acquisition becomes the end-goal, the route a startup takes is often different than if they were aiming for an IPO. From the design of the product to the emphasis placed on the team behind the product, there are certainly things that startup founders can do to increase their chances of getting acquired by a major enterprise.

Build a Product With a Future

As you are building your product or solution, it’s important to remember that you are not operating in an independent space. What does that mean? It means that you need to build a product that is not only innovative in its technology, but innovative in its market. Creating a product for which there is no need and which does not disrupt the market enough will not bring an influx of acquisition options.  

Build a product that is not only #innovative in its tech, but innovative in its market Click To Tweet

Building a product that has a future doesn’t just mean operating within the existing market conditions, it means seeing where the future of your industry is going and aligning your strategy with future trends. By building a product that has the potential to grow as well as a long-term development strategy, you will likely increase your chances of sustaining your company and perhaps even more importantly, appealing to potential acquirers.

Build Enterprise Relationships 

We looked long and hard to find a company that was acquired by an individual, and, as expected, we came up short. So, who are companies being bought by? That’s right, other companies of course. If you are looking to build a company that will one day get acquired, you will need to start focusing on your relationships with other companies early on – specifically big multinational enterprises who have the budget to meet your purchase demands and the capability to take your product to the next level.

There are many ways to build relationships with enterprises, but there is only one way that will connect you directly to key decision makers and give you the ability to really show off your product or solution; a successful PoC. You probably guessed that’s where we were going because prooV is, after all, a PoC platform that connects startups and enterprises instantly. Sure, we like plugging in our own company when we can, but not because we like tooting our own horn, but because we truly believe it. With or without prooV, completing a successful PoC is a great way to build relationships with enterprises, establish long term collaborations and make your company available for potential acquisition. Beyond the networking upside, there is a much higher chance that a company will offer to acquire your technology if you’ve already proved its viability on their existing infrastructure.

Focus on Talent

Your product is important, and your ability to integrate with enterprise ecosystems is also important, however, the true differentiating factor is more often than not, your team. Many companies acquire startups not just because of their solution, but because of the brains behind the solution. A powerful team that is able to work together and bring to market new products, is a team enterprises will want to put money behind.

It is also important to establish a strong culture that instills optimization and is designed for expansion and growth. In doing this, you will not only position your company for long term success, but you will attract more talent to your team, making acquisition even more appealing to potential buyers.

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Ultimately, there is no clear-cut road to guarantee acquisition, however following these tips will definitely help. The most important thing to remember is that you need to be persistent; opportunities will come and go, acquisition options may even come and go, but if you are persistent and passionate, you will find the right path for you and your company.