Wash, rinse, repeat: A startup is founded, first product ships, customers engage, and then a larger company’s corporate development team sends a blind email requesting to “connect and compare notes.”
If you’re a venture-backed startup, it would be wise to generate a return at some point, which means either get acquired or go public.
If you’re going to get acquired, chances are you’re going to spend a lot of time with corporate development teams. With a hot stock market, mountains of cash and cheap debt floating around, the environment for acquisitions is extremely rich.
And as I’ve been on both sides of these equations, an increasing number of my FriendDA partners have been calling for advice on corporate development mating rituals.
Here are the highlights.
Before my first company was acquired, I believed that every acquisition I’d ever read about was strategic and well thought out. I was blindingly wrong.
You need to take the meeting
Book a 45-minute initial meeting. Give yourself an hour on the calendar, but only burn the full 60 minutes if things are going well. Don’t be overly excited, be a pleaser and or ramble on. Pontificate? Yes, but with precision.
You need to demonstrate a command of the domain you’ve chosen. Also, demonstrate that you’re humble and thoughtful, but never come to the first meeting with a written list of “ways we can work together.” That will smell of desperation.
In the worst-case scenario, you’ll get a few new LinkedIn connections and you’re now a known quantity. The best-case scenario will be a second meeting.
But they’re going to steal my brilliant idea!
No, they aren’t. I hear this a lot and it’s a solid tell that an entrepreneur has never operated within a large enterprise before. That’s fine, as not everyone gets to have an employee ID number with five or six digits.
Big companies manage operational expenses, including salaries and related expenses, pretty tightly. And there frequently aren’t enough experts to go around the moneyball startups for new domains, let alone older enterprises.
So there’s no secret lab with dozens of developers and subject matter experts waiting for a freshly minted MBA to return with their meeting notes and start pilfering your awesomeness. Plus, a key component to many successful startups is go-to-market (GTM), and most larger enterprises don’t have the marketing and sales domain knowledge to sell a stolen product.
They still need you and your team.