M&A in the Technology Industry

I'm Kisam Patel and you're listening to M and A Science, where we talk with deal professionals and learn valuable lessons from their experience. This podcast focuses on stories, strategies and what actually happened during M and A deals. In this episode, Paul Weiskopf and I explore M and A in the tech world. Paul's experience includes more than 25 years of experience in tech industry with companies such as Hewlett Packard and Adobe Systems. He shares his knowledge on common strategy errors that lead companies to failure and the best ways to build integration plans for acquisition teams. Here's more on Paul's background.

My background has been for the past 25 years I've worked in technology industry performing functions related to corporate strategy, ma, business development, venture investing activities. I've had the pleasure of being able to carry out these responsibilities in technology companies of all sizes, from 20 person startups to 100,000 employee companies like Hewlett Packard, large companies like Adobe Systems, and companies in between like the one I'm currently at Duhmo.

Nice. Paul, how do you view the importance of M and A?

Well, M and A is a important, I think increasingly important lever which companies can use to further and accelerate their growth strategies and objectives. I think that too frequently M and A is viewed as something to be revisited or used periodically when a opportunity presents itself, or more frequently when a company feels that its portfolio is not optimal and some type of move is required to change the hand that the company is playing with. My perspective is that MA should be looked at and used as a core element of a growth strategy. I think a healthy company has a clear understanding and perspective on the goal and position that they want to attain in a market and work back from there to identify the capabilities which are required to be successful in that market landscape, to objectively assess their current capabilities against those which are required, prioritize those, and then look at the full set of options which are available between build, buy and partner. And I think when companies use a systematic process like that, almost every company will have a logical place or several where the use of MA could really be the best means for furthering acceleration of a company's strategic growth objectives.

It sounds like a strategic way of thinking about strategy.

Yeah, absolutely. So I think that M and A is really a practice. A specialized practice in art and like many other functional disciplines, has, you know, a whole host of details and special skills and processes and rules associated with it, but it's done most successfully when it is directly plugged into an overall strategic goal, objective and set of priorities for A company.

How do you ensure you're doing, say an M and A acquisition for the right reason?

Well, I think it starts with do you have clarity on the strategic goal? I think that if you were to canvas companies who consider M and A opportunities, and I'll also speak about this from the standpoint of my own experience, I'd say over the course of doing this type of work for a couple decades, I would say that in a typical week I will see several opportunities come across my desk or email companies that are selling themselves. And if you do not have clarity with respect to what you are looking for, you will find yourself buried evaluating and responding to opportunities that are defined by others. I think the most effective acquirers begin with having clarity of the strategic objective, knowing what capabilities they're looking for. What are the criteria that constitute a good fit for M and A and which of those capability areas are ideal candidates to proactively look for M and A targets. The best deals are generally those which are proactively sought, cultivated diligence effectively versus those that you respond and act on because company's been put in play by somebody else.

Have you ever been on a team where they would over bill, overbid or build a case for doing a deal for the sake of doing a deal?

I think that that's a classic challenge and I see this the result of a couple of different things. One is if you don't begin with clarity on the strategic goal or rationale for why you are pursuing a deal as part of that, laying out specifically what the assumed value drivers are for the acquisition, detailing your assumptions, being realistic about synergy potential and how much of those you're willing to share. If you don't begin with that type of. Of a discipline, the likelihood that you fall victim to deal fever is very high. And this notion of deal fever is one that I've seen throughout my career. It's pretty common. M and A is deemed by those who don't do it on a day to day basis as something sexy and exciting and people want to be part of it. And these are major undertakings. They involve a significant amount of time, of personal energy and expectations get built up about what could be post an acquisition and the further you get in a process. For those who are less disciplined or experienced, there is a tendency to want to do the deal and to rationalize things that may come up that are red flags or to talk yourself into assuming a higher amount of synergies to justify not losing the deal to a competing bid.

So reality checks are important.

They're critical, particularly given what the historical success rate for M and A has been for companies where this is well documented by a number of different studies. But the majority of acquisitions ultimately are deemed failures and don't earn their cost of capital. And those failures result from a variety of things. But if you are not disciplined, you're more likely than not to add to the lengthy list of deal failures.

Anything particular one can do to have that kind of mindset?

Well, I think that at the broadest sense, I think that when deals fail, the reasons would fall into one of three broad buckets. The first is the wrong strategy. So the wrong assumption or bet about what capabilities would be required to be successful in a market or not correctly assessing the capabilities that the target brings to the table. Those are things that I would call a failure in strategic rationale. You paid the wrong price, which generally means you assumed the synergies to be realized were too high and you failed to meet those thresholds. And it's also pretty clear evidence that the tendency to overestimate and miss revenue synergies is a far bigger problem than estimating and capturing cost synergies. The third categorical reason, and the one that I think explains most frequently is why deals succeed or fail is integration. And with integration, the biggest issue is that too little time is spent on it. Too many think of integration as an afterthought, as the tactical details to be addressed by others post deal signing, where integration is really where the rubber hits the road. And if a effective integration plan is not built before you actually get into the depths of diligence, the likelihood that you will have challenges in integration are very high.

Would you say that's the biggest overall challenge in doing a deal?

I believe so. I think that it's the single biggest determinant of success and failure is the approach to integration. I think it's why you see that there are a handful of companies that have been successful as serial acquirers, and those which don't do MA frequently have a much higher tendency of experiencing failure. And that is explained in my view, by the lack of dedicated personnel with a lot of accumulated experience and knowledge about the pitfalls, challenges and tricks of the trade and disciplines required to execute integration effectively. It can't be a part time job. And too many companies start thinking about integration when the deal is about to get signed, and then they look around to figure out, well, who can we task part time to focus on it? And in more cases than not, if that's the mindset your deal is going to Fail.

It seems like looking at the serial acquirers that their process evolves as they get experience and do transactions. And I know you've seen it and you've been on different teams both within, without experience, how would you describe how that evolves, what that looks like?

Yeah, it's a great question. Way I would first respond to that generally is M and A and integration in particular should be viewed or thought of as a skill set and discipline not unlike marketing or sales management or product management. Each of these functional fields have their own challenges, responsibilities and nobody ever has a hundred percent success rate in the activities that they carry out. But there's a set of processes and science and kind of data related discipline that's required to constantly evaluate how you are performing relative to your assumptions, look for feedback, incorporate that feedback, constantly tune your approaches to be as successful as possible. And you know what that means. In the context of integration and M and A, there are many aspects of it which are repeatable, where accumulated experience helps you quite a bit in understanding the cadence, timing, when certain aspects of integration or deal need to be dealt with, what kind of anxieties the target companies, board employees and advisors are experiencing when how to deal with those most effectively. Also within your own company you have those same set of concerns, requirements checkpoints that have to be addressed. And one learns after going through a process many dozen times how to do that in the most effective way. But there's also an aspect to MA like there are with most things in life or work that you know, every interaction or engagement or deal has some unique aspects or characteristics to it. So despite having been in this line of work for 25 years and completed many dozens of transactions and looked at probably over a thousand, I learn something new every time I get involved with a transaction.

So you touched on quite a few things. As these firms evolve their process, their metrics are getting better, their cadence is getting better. The planning, the way they anticipate issues. How about as how they approach planning for integration?

Yeah, well, the best way to approach planning for integration is at the outset of a deal. So I think it's critical at the time when you are developing a internal business case to explain the strategic rationale for pursuing an acquisition and a specific target, and your assumptions about value drivers and potential synergies that you need to at the same time be taking the next step, which is to lay out and articulate what set of actions and organizational structures and product and people decisions would be most logical and necessary for you to be able to execute the strategy as articulated and capture the synergies as described. To give you a couple of examples, something that I see frequently as mistakes when people don't take a disciplined approach like this, you'll make a general assumption to say, we're going to acquire this company and we're going to generate a significant amount of revenue synergies by adding the target company set of products and services to our portfolio of product and service offerings. Most typically, then what a company will do, since they have not completed a robust enough integration plan, is wait until the deal closes and then say, well, we're going to keep the acquired company as a separate unit inside of our organization. So already at that point, the likelihood that you're going to attain synergies on the revenue side or even on the cost side, when you are acquiring a company and allowing it to be a standalone unit, you're almost set up for failure from the get go. If your core assumption is I'm going to cross sell this product into my existing accounts, well, then your sales organization needs to be armed and equipped to sell all of the products. And that needs to be managed under one sales organization, not through multiple or separate sales organizations. And there needs to be a specific and clear product roadmap to bring the acquired company's products and services logically integrated into your core platform and technologies. And when that unit is left as a separate standalone with the idea of we'll integrate it over time, in more cases than not, it never gets integrated.

How can a team plan better?

Well, I think it comes back to being realistic and disciplined about documenting the core value drivers and assumptions that are used to justify pursuing a transaction. Be really specific about where the assumed synergies are going to come from. Lay out the necessary steps that will be required to capture those synergies. You need to be very operational and practical from a standpoint of assigning key deadlines. From my experience, day one, day 30, day hundred are the most critical relative to the key steps which need to be taken on integration and have a owner for each of those steps. From my experience, if you're not on track by day 100, the likelihood that your deal is going to fail to meet his objectives grows exponentially. And you need to have the discipline to, you know, beyond that day one, thirty and hundred window, establish regular checkpoints for evaluating progress of integration and considering potential contingency plans for addressing variances which you know, invariably do come up in the context of integration. So you need to come into it with the planning and assumption that it's going to be difficult that it's akin to developing and launching a new product. And it requires that type of daily management oversight, vigilance and willingness and ability to adjust in a timely manner.

Who should be doing that planning?

Well, I think the planning is best done by a combination of folks. I think it's most successful in my experience, when you have a combination of somebody in a corporate development capacity who is seasoned and experienced in doing integration planning and being able to provide the templates, structures, experiences, examples from previous integrations as to the key steps that should be taken when to provide the overall program oversight to ensure that things stay on track. But critically, you also need somebody from the sponsoring business unit or function functional area within the organization who is going to be a core part of that team. And that person needs to be akin to the product manager. The person needs to be empowered and field ownership and held accountable for delivering against the assumptions which were laid out to support the rationale for pursuing the transaction in the first place.

What kind of findings or events would cause you to deviate from your plan?

I think that they happen categorically in a few different areas. What I've done over the course of my career that I found really helpful is to have a set of metrics that I use to monitor, track and report on performance for all acquisitions. And I use this as a means to help ensure that the integration team is getting timely and relevant information so that they can act on it. But it's also used as a means to improve the understanding and knowledge of the executive team and board of a company and to also help instill and impose discipline and accountability relative to achieving synergies that were promised at the outset and the general categories in which I tend to group. These are four. The first I'll look at a financial set of metrics so revenue synergies. Revenue synergies by type, whether it is cross selling into existing accounts or penetrating new accounts or penetrating new geographies or customer segments. Cost synergies G and A Separate from sales or marketing types of cost synergies and also looking at integration costs. This is something that can get out of hand if you are not disciplined in managing tightly the use of external advisors or consultants to help in completing integration tasks. The second category that I look at is technology and product. So in general you have assumptions or goals relative to product integration. Quality, the ability to obtain or further technology patents or accelerate a pace of new product innovation. So measuring and monitoring those things, ensuring that they're happening in the time frame that was assumed very critical. The Third one is around people and the organization wanting to monitor very tightly retention, retention overall, but retention in particular of the identified key individuals, assessing employee morale through formal employee surveys and also informal check ins with key employees. And then lastly, but you know, probably most important with customers, looking at, what are you seeing in terms of the actual retention and satisfaction levels of your customers, those who came along with the acquired company and to your existing customers to whom you have cross sold an acquired product or service, how much of.

That would you start putting together during diligence? Because it sounds like you should have that information or start learning about that company pretty far in advance.

Absolutely. So the way that I've approached this, and this is something that I learned over years versus something that, you know, I fell into initially in this line of work. So the way that I've approached this is in the context of developing a business case to justify pursuing an acquisition. So getting an approval to pursue a deal and getting approval to negotiate up to a certain dollar level, these elements need to be part of that overall business case. You need to have a set of articulated assumptions. If you're making a forecast to quantify what potential synergies are as a basis to justify evaluation, then you should and need to be able to articulate what those underlying assumptions are that are going to get you there. And so the business case used to justify pursuing a deal, I would ensure, would have at least initial set of quantifiable assumptions covering metrics in each of these four categories that would help inform, as you go into more detailed diligence or confirmatory diligence in an acquisition, to come back and revisit those assumptions and see if what you've learned validates what you've assumed, or if you need to adjust or revise those. And based on the degree of adjustment, that might suggest that you reconsider valuation or in some cases reconsider the rationale to pursue the deal at all. And then, you know, post actually closing a deal using these, these metrics. This framework serves as a really useful instrument to set targets and accountability for the sponsoring executive and his or her management team that the CEO and board will hold them accountable to. And then what I would do in my capacity as a corporate development executive is ensure that we looked at these formally on a quarterly basis and we share that information with the internal management team and with our board of directors. And the process that I used would look every quarter and report on all deals with a look back two years. So we'd always look back at least two years on Any acquisition done and doing that would help improve our learning, our understanding of things that did not go well and that we needed to get better. And by highlighting those numbers really at the highest levels of an organization, it increases the level of understanding, ownership and accountability for all involved in terms of.

Monitoring and measuring success. What else would you do to track it? Post closing. Because it seems like it would be really challenging once you integrate the company and everything's sort of binding together.

Well, you're able to do it based upon the approach that you're taking to integration or the strategy or rationale that is behind it. So I found that all four of these categories work in any type of deal. Now, what the specific metrics are that you use within those categories will vary based on the approach. So for example, if you are acquiring a company and, you know, actually keeping it as a standalone product offering and business unit, then you could and should measure and track it against revenue and contribution margin goals. Alternatively, if you're doing a tuck in acquisition where you are bringing in a team and technology, the notion that you're going to measure it on revenue goals is really less important and you would put much greater weight on metrics in the technology and product area around the timing and success of integration of that technology. And then you would look also in the customer category, the rate of adoption and satisfaction that they have with the integrated technology.

Gotcha. So really defining those specific metrics, you know, if it's bridging a roadmap gap and then, okay, we plan to do that in this amount of time and building those goals around that.

Right. The process is generally applicable for all types of ma, but the specifics vary quite a bit based upon the size of a transaction. How are you going to approach the integration of the transaction and the categories from where synergies are expected to come from?

Paul, when you describe diligence and integration, you describe as a very integrated process. And that's not what I've seen. I've seen it as more of a disconnected process that separate teams are doing. And I'm curious to know sort of your thought and experience. And it seems like the best practice is to keep it early. And that's what a lot of the mature teams are doing essentially is having the integration people do the diligence, I guess. What's your thoughts about that and the best practice?

That's certainly my point of view. If you look across companies, you will find a pretty broad spectrum of approaches which are used to conduct M and A and integration activities. My perspective is that the most effective and successful way to use M and A as a lever is, is for MA to be part of a team which has skills and responsibilities both upstream and downstream from the transaction. So what I mean by that is people who are also involved in helping develop a strategy for a company have a clear understanding of capability gaps which a company needs to address, helping evaluate, build, buy and partner options for those different capability gaps. Going through that type of a process gives an M and a professional a level of awareness insight to be much more objective in evaluating prospective targets. Contrast that from a situation which is all too common where somebody else does the strategy and they call in the M and A specialist to say, we want to buy this company. And the M and A specialist, if their role is defined that way, doesn't say, well, why are we buying this company? Their tendency will be, great, I'm on it, let's get it done. So that is really an important differentiation in the setup or approach leading into ma. And I think a similar thing exists downstream. I see too frequently, as you mentioned, that companies will have integration as a separate activity. Most alarmingly, for even companies that do one or two deals a year, they won't have dedicated people who are specialists or experts in integration. They will pull people in periodically, periodically when they need them to complete integration. Contrast that with a situation where somebody has had experience in helping develop integration plans, helping be part of a diligence process, staying involved post close of a transaction, monitoring and reporting on success metrics for multiple quarters post completion of an acquisition. And again, another concrete example is if for organizations where these responsibilities are not core to the role of the M and a professional for that individual, the deal is done with the closing dinner and they're ready to move on to the next deal. And from my experience, the easiest part of M and A is closing the deal. The hardest part of M and A and the most important part for doing M and A successfully begins post signing of the deal.

Very true. So say you're a CEO, just went public, and you're forming a new corp dev team, and you're picking your candidates to lead this corp dev team, all with similar years and experience. He had a choice between the guy with the finance background, the guy with the operations background, the banker and the lawyer. Who would you be inclined to choose to lead the team?

It's an interesting question. I look at it less from a standpoint of what's your background? Because I think your background is less a good predictor of who's going to be most successful in M and A. I look at it more from a standpoint of mindset. Each of those different backgrounds that you describe bring relevant, valuable experience and expertise to being successful in ma. None of them is sufficient or complete. And the key ingredient that I would recommend the CEO look for is an individual who who has a mindset which is oriented around helping a company be successful and helping a company be clear and disciplined in articulating what its goals are and what's required to get there. An individual who has the ability to think critically and independently, to lay out his or her assumptions and to challenge those who don't do it as clear as they should. And then lastly, I'd say an individual who also brings an attitude or mindset of I'm willing to roll up my sleeves and help tackle and contribute to whatever task is necessary for this endeavor to be successful.

That's a good answer. How would you test them on that?

I would test it through a combination of looking into what their previous experience has been specifically to walk through different projects or successes that they would highlight or tout on their resume or in the interview, have them describe very specifically the role that they played, how they interacted with others, whether they viewed the project as success, and why. I would also approach this from a standpoint of asking them what they think my company, in this case, if I'm the hiring CEO, most needs or should be looking for in an individual to fill this role because it will be very telling relative to what their expectations or preferences are in terms of how they operate.

Makes a lot of sense going back to deals. What kind of surprises have you seen during diligence and even integration?

Boy, I've seen a lot. They come in. I think some of the crazier forms that I've seen are late changes to financial forecasts or historical financial statements. A, you know, obvious and big red flag. I've seen situations where key employees in the target company have left or threatened to leave during a diligence process for a company. Seen situations where there was threatened or pending litigation that was not disclosed until, you know, the final bring down of the reps and warranties of a document. So there's a whole range of things that I've seen and you know, I would generally describe them as surprisings and it's surprises of a huge magnitude. And it's not that you encounter surprises. Every deal will have some. The more important thing is how big is the surprise. And by big I mean does it rise to the level of questioning the rationale of whether you should pursue this deal or not? Or does it rise to the level of you questioning the value of the transaction or your ability to successfully integrate it? And the second element of surprise is when did it come up? And in that regard, I much prefer to have surprises come up earlier than later. The very, very late surprise, in my view, is a sign of either intentional effort to hide information or incompetence relative to understanding what's happening inside of your organization. And so for me, the late surprise is always a cause to pause, step back, and really give a serious thought to whether the transaction makes sense, whether you've unturned all the stones and diligence. And in the cases where that's happened, I have extended the diligence process to dig to additional levels of depth to give me the necessary clarity and comfort on whether proceeding made sense.

How do you get a mindset to find those kind of surprises during diligence? Because it seems like you really have to think outside of the checklist to be able to find them.

Yeah, it's a great question. I think it comes back to one of the answers that I gave you relative to what a hiring CEO should look for. So it's the mindset. If the mindset is I'm motivated to help a company further its growth strategy and to use M and A as a lever as successfully as possible, well, then they have an orientation that says the likelihood of being successful is not great. And the way to have a much better than average likelihood of being successful requires a level of diligence, objectivity, critical thinking, and expectation that there is this surprise and that some aspect of your assumptions are false. And so as a leader of a corporate development function or a leader of one of the teams carrying out diligence in a particular area, it's critical for that individual to be disciplined and to model the type of mindset and line of questioning that will bring out those types of insights. So to be more specific, I start each of my reviews with tell me the surprises. And there's two key aspects of that, which is I'm setting the expectation that there are to be surprises, because there are. And so you need to look for them. And it's not only okay, it's expected that you're going to articulate what those surprises are. And if you say there are none, then I will dig deeper and I will then highlight or show an area of surprise and use that as a learning opportunity. But then if you start with that type of an approach, then people will go to the next logical question, which is, well, why Was that a surprise? How big of a surprise is it? How much does it matter? What other areas do we think we might find surprises and where should we look next?

Have you ever had a post closing surprise that made you want to kick yourself for doing the deal?

Yes. While I'm proud of a collective experience that is well above the average success rate of M and A, you know, I certainly can't say that, you know, my batting average Is has been 100%. I would say in terms of surprises, some of them are ones that you can't really kick yourself over, meaning they truly were surprises, you know, relative to shifts in technology or shifts in macroeconomics or market valuations. But there also been cases where you kick yourself for seeing and raising an area of concern on the people or culture side and allowing yourself to talk yourself into or be talked into it being something that can be managed effectively and you learn from those types of experiences and become more disciplined. And that's really the path to ultimately continue getting better.

That seems like one of the most challenging parts is when it comes to culture and seeing if they will actually fit together. How do you think and evaluate about that?

Yeah, it's very difficult. I think you need to look at it both at a overall team or organizational level, but you also need to look at it at the individual level, in particular for the key employees at the broader cultural level. I think what's important is to understand whether you are bringing in a culture which you deem compatible and a strong fit with the acquired company's culture, or your objective is to augment or change your existing culture by injecting it with a dose of different perspective and mindset. And I think in the latter example is more frequently the case where wishful thinking gets the best of you and the body rejects the organ transplant. And so you really need to be objective and realistic about the ability for the transplant to take at the other level with the key employees or individuals. I think that a mistake I see is that we have a tendency to generalize and say that, well, you know, people are motivated by, you know, key employees in the context of an integration and retaining them. They're motivated by a combination of, you know, what is their, you know, financial or comp plan going to be, you know, what is their title and position going to be, and, you know, what is the level or degree of organizational influence and control that they're going to retain or inherit coming into the acquiring company. And while those are correct in terms of the categories, I think the mistake that I see Most is that people project their own relative value or weighting of those three things onto other individuals without approaching it with a mindset of assuming from the outset that every individual's weighting is different. And the goal is to find out and understand what that weighting is for each individual and how that shows up is if you're the type of person for whom it's all about the money, well then what you'll do is say, well, look, the key here is we just got to put the golden handcuffs on this person and make it so that, you know, financially it would be stupid for this person ever to walk away and spend most of your time there. You know, whereas you have lots of examples for, you know, particularly those individuals who are serial entrepreneurs, that's not going to hold their attention. If they're driven most and, you know, most happy by being able to drive innovation and see that innovation manifest itself in the form of, of a product that customers are successfully using, well, then it's critical to ensure that that individual retains a role, influence and the ability to keep driving that type of innovation without being slowed down by an organization's processes or politics, et cetera. And so it's really important to look at each individual with a different set of motivations and, and tailor the retention packages and job offers and roles very specifically to each of the key individuals.

How do you take that to action when post closing there's all this uncertainty that happens?

Yeah, you need to do it in kind of a cascading fashion. So for a acquisition, in most cases, it's good practice as an acquirer for you to make as part of the deal a certain take or acceptance rate of key employees. So, you know, you get to name a certain number of key employees and for the deal to close, you know, at least, you know, X percent, 70, 80, 90% of the identified key employees need to agree to, you know, mutually, you know, with their new employer, an employment package. And this is the aspect of acquisitions which generally gets negotiated last in the overall deal. But they're really critical and these are the ones where, where you as the acquirer needs to take this individualized approach to each of those key individuals, figure out what's important to each of them, which is a core aspect of effective diligence process, translate that into a specific offer and role in the go forward organization, a critical aspect of any good integration plan, and get them on board. And then post closing, you then work with those individuals to address the next layers in the organization of the acquired company to go through a Similar process, you know, to figure out how to best incent, motivate and retain those key individuals throughout the acquired organization.

In terms of evaluating culture match, is there any way to test that? Like, does the beer test apply? How do you do that?

Yeah, you can do that. I mean, I've heard a lot of different descriptions for that. I mean, you've had the, the beer test, the o' Hare test, you're caught in the airport with them for hours, the Bella Caroly test. Look them in the eyes and you know, see their fire. But I think what it comes down to in the case of culture is culture is ultimately evaluated by individuals and it's evaluated in a subjective way. And the way to do that most effectively is to have good representatives or stewards of your company's culture. Be part of the diligence process in meeting these individuals in the target company and you know, asking them for their assessment and using it as a two way street. Having these individuals really share with the executives of the target company what the culture is like in your organization. Because it is just as critical for key employees in a target company to conduct their diligence as it is for you as the acquirer to conduct yours on them.

It's a really good point, getting their input and ideas. So Paul, last and favorite question. What's the craziest shit you've seen in M and A?

The craziest thing I've seen in M and A. Well, I'll give you two. One is the repeating as an industry, the same predictable mistakes over and over again. I've been in the space, as I mentioned, for over 25 years. And through that period I've seen many cycles of boom and bust in the markets and M and A. And the general and repeatable and shocking pattern that you see is the pace of activity and urgency and panic to pay up for deals rises when the market is relatively overvalued. And then when the market corrects, everybody is scared of MA and steps away from it and they don't begin buying again until valuations have come up 20, 30, 50%. It's shocking to me that that cycle repeats itself over and over again. On a more specific level, probably the most shocking thing was a acquisition that I was working on to complete. We were in the 11th hour of negotiations. We were in Manhattan in attorneys offices. We had like a last item or two in the purchase agreement to close on the target was a public company, I was working for a public company. We were scheduled to announce the deal before market open and with a couple of hours to go. The CEO of the target company was nowhere to be found. His bankers and lawyers explained that he decided that he needed to go for a walk and so at 4 in the morning until 5 in the morning, he was AWOL, walking the streets of Manhattan, where we were left to wonder whether this deal was going to close or not.

Wow. That's what happened.

He came back probably still as agitated as he was when he left, but we ended up working through the remaining issues and successfully completing the deal. Not what I expected. Yeah.

Wow. That's funny. Paul, thanks for your time.

My pleasure.

Thanks for tuning in to M and A Science. We hope this podcast provided valuable insights. If you have interesting M and A stories or suggestions to share, reach out to me. You can find my email in the Show Notes as well as any links or tools mentioned in the podcast. Join us next time when we uncover more perspectives to successful M and A transactions. This podcast was brought to you by Day One Day One takes an agile approach to the management of the entire MA lifecycle process. We develop strategies to drive innovation to create the highest return on MA transactions. Day One can work with you to implement custom solutions for your most complex problems. Visit ondayone.com to learn more.

Sam.