Navigating the New M&A Landscape with Indy Guha (VMG), Jared Roesch (OctoAI), Dan Kang (Mercury), Michelle Edwards (Perkins Coi) | Inside Summit 2025 [LIVE]

Someone's got to believe in you and want you to win the deal as a startup relative to some incumbent. And they're taking a bet on you. They're putting their personal capital, their reputation on the line. And one of the reasons customers churn is executive turnover. All the same dynamics apply to how young companies join big ones and figuring out that champion. Are you on texting basis with them? Are they giving you a back channel on how things are playing out and how to work the room? All of that needs to be there.

Welcome back to Season 13 of The Room Podcast. Claudia, can you believe we've been doing this this long?

No, it's been 5 years. So many episodes, so many incredible conversations telling the stories of some of the world's most iconic founders and funders. And whether our listeners are new for the first time today or have been with us from Season 1, we're so grateful for the community we've built.

Completely. We've had the mission to open the door to the room where it happens. For those entire 5 years and have been able to do so over 120 episodes with hard-earned lessons from some of the top technology and consumer founders of our time.

And we've been through a lot personally as well. We have indeed. I built, scaled, sold my startup Priv. You were our first investor, so you've been there through the entire journey. And you've also recently graduated from HBS. You're now building at Vercel. And through it all, we've brought the funder and founder perspective.

Yeah, it's really been an incredible journey, and I'm thrilled that I'm back full-time in San Francisco, and we're probably here to stay. Uh, that means that there's more more for us in terms of growth, both inside and outside of the physical room. But what's important to have really out there is these stories, and we've been able to do so over incredible guests from the CEO and founders of Flexport, Perplexity, Particle, Zapier, Zillow, Vanta. I could go on. These guests and their enterprises have generated over $100 billion enterprise value and really, frankly, moved the markets.

And growing, especially in 2025 with everything that's going on in AI. So I'm so excited to share Season 13 stories that are maybe a little bit more AI-focused than past seasons.

Absolutely. And you can find us IRL and URL, especially with our events such as our annual conference, Inside Summit, or upcoming SF Tech Week events and beyond.

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Welcome back to another episode of The Room Podcast. Today I'm sharing one of my favorite conversations from our Second Annual Insight Summit in San Francisco, a day where we had some founders, funders, and operators coming together for real talk about building, scaling, and navigating the moments that define a company's trajectory. This session, Navigating the New M&A Landscape, brought together a powerhouse group of voices who see deals from every angle. I had the pleasure of moderating a panel right after my own exit with Michelle Edwards, partner at Perkins Coie. Indy Guha, General Partner at VMG, Dan Kang, CFO at Mercury, and Jared Roche, co-founder of OctoAI, who recently exited to NVIDIA. Together, we unpacked what it actually looks like to sell or buy a company in 2025. From the legal and financial realities of today's deal structures, to the investor POV on how acquirers make decisions, to the operator's view on what it feels like inside a live transaction. This panel gives a rare 360-degree look at a market undergoing massive change. We talk about why deals get sourced the way they do, how AI and shifting public markets are shaping exit paths, and why the best M&A outcomes start years before a term sheet ever shows up. You'll hear candid lessons on cultivating strategic relationships, signaling readiness to buyers, managing your team through an acquisition, and avoiding the red flags that kills deals at the finish line. Whether you're fundraising, scaling, or fielding early acquisition interest, this conversation is packed with the kind of tactical founder-first insights we created Summit to unlock. Let's open the door.

Thanks everyone for being here. Excited to kick off our M&A panel. Quick framing here. M&A has really become an increasingly important path for founders in 2025, whether as a strategic exit, an option for liquidity, a defensive move, or a scale play. Today we're going to unpack what's working, what's not, and how founders should prepare. I sold my startup a few months ago. It was quite an intense process, sold to private equity after building for 4 years. And a lot of founders are asking me, hey, what actually happened? How do we think about it? What are the dos and don'ts? And there's oftentimes not a lot of transparent conversation about this topic. We have an incredible suite of experts here. We have Michelle from Perkins Coie, who is our M&A lawyer extraordinaire. We have Indi Guha, a general partner at VMG, Dan Kang, CFO at Mercury, and Jared, who also is an exited founder to NVIDIA. So before we get into the meat and potatoes of the conversation, let's go around the room and maybe give a couple of sentences around what your experience has been with M&A and just a hint of your background. Michelle, we'll start with you.

Yeah, sure. Hi everyone. I'm Michelle Edwards. I'm a partner at the law firm of Perkins Coie, and I'm based here in San Francisco. I've been advising on M&A transactions for probably 25+ years, so I haven't counted, but it's possible it's hundreds. Right now, my practice is mostly weighted towards sell-side mid-market M&A, and I really enjoy helping advise founders on how to navigate the M&A process and successfully sell your companies.

Thanks, Michelle. Indy, over to you.

Tough act to follow, but I'm Indy Guha, co-lead VMG Technology. VMG is a consumer ecosystem-focused venture and growth equity firm, billion-dollar fund for consumer brands and services, $400 million tech fund focused on commerce infrastructure, supply chain, things that help consumer brands and services scale. And so I sit on the tech side. In terms of M&A experience, let's say nowhere near the range of Michelle, but certainly have got the pleasure of going deep a few times across different types of acquirers, whether that's Citrix acquiring Wrike, where we were the Series A investor for $2.25 billion, or Vista acquiring Gainsight for $1.5 billion, and other examples like that. So hopefully we'll get to touch on some of those differences as we go through this conversation.

Uh, hey everyone, I'm Dan. I'm the CFO at Brickery, proud sponsor of the podcast. I've probably been involved in maybe a dozen different M&A transactions across all sides. I used to be in private equity, actually at Vista. It's funny that you mentioned where we help acquire companies primarily in software. Also on the sell side, my last company, I helped the founder sell the company for a $200 million outcome. And I've been involved on the corp dev side actually being at companies where we are acquiring companies, both at Square back in the day. And then also we did our most recent acquisition for Recreate last year.

Hey everybody, I'm Jared. I had done a startup for the last 5 and a half— actually, it'd been 1 year since we sold the company this week. So previous 5 and a half years before that, we had been doing a startup. We sold NVIDIA last year. And then when we were a startup, we looked at doing an M&A of some other small startups, both from the startup as the acquirer, also been a little bit involved in NVIDIA. And yeah, mostly my experience is being in the heat of it.

So it's safe to say with this group, we can probably cover every nook and cranny possible with M&A, but let's start with maybe a little bit of the market landscape today in 2025. Indy, let's start with you. From the investor side, How do you see M&A shifting this year? Are strategic acquirers getting more active than private equity? How is that kind of influencing how you advise your portfolio?

Hopefully we can make this a little bit interactive. There was a lot of optimism starting the year that this would be the year the floodgates opened for deal activity, for public markets, and to a degree with a bit of a snap in Q2, that did happen. Big picture, you sort of look at the numbers, First half of this year, deal value across tech in terms of volumes is up 20% year over year. And volume's probably the more interesting number for many of the folks in this room. As much as I hope you all end up with a Google-Wiz type outcome, that is the dramatic outlier. And when you look at it on a dollar basis, like 30 to 40% of all M&A is gonna be that tippy top of 3 or 4 deals each quarter. But I said I'd make this interactive. Show of hands, how many of you think the median M&A event is above $300 million? Okay, savvy room.

I like it.

How many of you think it's above $200 million?

All right.

Below $50 million? Any hands?

All right.

So if you didn't put your hand up on that last round, you win. It's $90 million. Lara, let's do this the same way. Above or below 5 times revenue? You're right if you thought it was below. 3 times revenue is the typical acquisition multiple right now. And so I think those two numbers are worth grounding on. $90 million, give or take. 3 times revenue, give or take. As you think about what's the right funding strategy for your business, how big is the end market you're building for? How big are the pockets of potential acquirers for your business? But I'll probably stop there for now.

No, that's great. Let's talk a little bit about the capital markets perspective. Dan, I'd love to hear your perspective here, given where we are with interest rates, valuations, IPO windows. Also, an interesting segment of companies that raised a lot in 2020, 2021 are not AI native, and so they're maybe having a hard time fundraising. What's driving more companies towards M&A versus continuing to raise at maybe less than ideal terms, going public, chasing a secondary. Tell us more.

I feel like M&A for founders almost feels like the backup option. I feel like every founder dreams of going to be a public company, go IPO. It's like really exciting to think about that. But I think M&A could be like really strategic across a lot of different ways. If you think about particularly with AI companies and how important scale or having access to distribution networks really are beyond just creating like really sick product is for you'd have the impact that you probably want when you think about starting up a company, right? From a capital markets perspective, it is interesting right now. Rates are expected to come down. Equity markets are really hot. What that means is that a lot of buyers out there have the capital, whether that's cash because they go raise debt financing or because their stock's just worth more and they're able to afford a lot more. So I think there is increasing buyer appetite. There are a lot of companies out there scrambling to figure out what is our AI play. If they don't have it natively, they're probably going to go acquire companies to do that as well. I think it's a great opportunity to think about it. I think also founders, it's how do you have just unbridled optimism irrationally, but also a sense towards how do you be set up for success? And sometimes it is access to capital or access to resources that are hard to do it alone as a standalone company. So I think it's a big part of consideration set. I think it's a little bit different versus maybe about a year or two ago where capital markets were a lot more frozen. I think acquirers were a little bit stingier because of that, because they just didn't have the ability to pay up on consideration.

Which is a perfect segue into how deal terms have changed. Maybe Michelle, for you, what are some of the most common structural shifts you're seeing in deals compared to a few years ago? We had the windsurf deal happen. There's a lot of deals that are structured in that way, less traditional. What are your thoughts?

I see today a lot more emphasis from buyers on the people and the team and the talent they're acquiring. And you mentioned Windsurf, which was quite a unique structure, and probably most people here are familiar with it. Brief recap, Windsurf, I think, was in negotiations with Microsoft to acquire the company. That fell through. Google came came in, hired away the Windsurf CEO, key talent for a couple billion dollars, but left behind the rest of the team and the company. And then I think Cognition came in and bought the remaining Windsurf. But you saw that really created, at least in the, the circles I run in on LinkedIn, a lot of commentary about where really is the value in a company, as well as what obligations do founders have to team members and and making sure that there's benefits to everyone when there is a successful exit. That could be a whole separate podcast. So I do think though, there's kind of a rise in including traditional acquihires, and we may see more unique structures going forward. The other thing I would just quickly mention for anyone thinking about selling their company in terms of structural shifts is probably going about, I would say, a decade ago, you started to see something called reps and warranties insurance, which is when buyers come in and they acquire a company instead of founders, you having to indemnify them, right, for breaches. The buyer buys an insurance policy and that's much more favorable if you're selling your company. I would say today as compared to like a decade ago, much more common to see that insurance even in deals that are not as sizable. So definitely something to think about if you're talking to a buyer about selling your company.

That's super interesting. Thank you for that insight. Let's talk a little bit about the founder perspective before we get into some other pieces here. Jared, tell us a little bit about your deal. What was the moment that you realized, okay, acquisition is the right path for us?

We ran for about 5 and a half years, so we had different phases. I think one thing that is maybe not full unique, but more unique is that we were doing deep learning inference AI stuff from 2017 in academia and like the company we did in about 2019. So we existed in the AI market before ChatGPT happened. So we had multiple years of the first phase, the 1.0 of the company where the whole world is very different. And so once ChatGPT happened, as everyone knows, the whole world changed. Like for example, we were about to do a large deal with Microsoft on December 2022. And by the time we came back on January 5th, even our internal sponsors had been scrambled and the whole company was going to get reorged and mission changed. And I actually even went to a dinner a month later where all the people were working on Turing, which were their language model at the time, were like all just talking about OpenAI, even though that's what they'd been working on for 4 years. So I think that really was a unique experience. Coming out of that though, is then everyone showed up in the market with brand new companies. So all of a sudden we went from no one cared what we were doing roughly to there being a bunch of of 4-month-old competitors who were heavily capitalized. And so for us, a lot of it was we were Series C as well. So we're in this sort of this weird growth thing where venture capitalists for the most part are ageist. Sorry if anyone feels offended, but no one really cares about your revenue dynamics when you're like 2 years old or 1 year old. No one's really like, oh, what's the gross margin? Like blah, blah, blah. And so by the time you're 5 though, people care. And so you have all those dynamics at play going on. And then at the same time, we were like, is this market going to exist? Because when the ChatGPT moment came, I was like, in the first week, I was like, this open source model stuff's going to happen. Is coming from commodity market. Startups are not good at selling commodities. And in 2024, we saw that play out, which like OpenAI became cost conscious, Anthropic became cost conscious. So we're all like, is there going to be a market? And I think that was kind of the moment, the beginning of that year, we were like, maybe we should consider what our other options are. And then I think on the human element, we'd all been doing almost 6 years plus 4 or 5 previous years of PhD and research and all this stuff. We were all a little bit tired and we're like, are we ready to kind of go to war for another 2 to 3 years in this market? And then I think back to the team side, when your valuation gets high enough, you actually have to have enough people. We were at 100. Most people, if they joined at Series B or Series C, the only way for them to get a really great outcome is for you to 5x the company to be like $5 billion company. So then when we started to think about how does this impact everyone, the reality is a good golden handcuff package from one of these large companies is actually probably much better for most of the employees. So I think all those factors started going into play. And then, so we spent, let's say January of 2024 when we closed our acquisition in September. So it was like a very long process. And I think one thing that might have shifted is no one was really doing M&A that year over a certain dollar amount. We talked to a lot of the big companies and there was a lot of anxiety from the Googles and the Apples and the other people in the world who weren't really doing large value, dollar value M&A. So that, that was like another really interesting, complicated tension in that time.

That's super interesting. What's one thing that surprised you the most about going through the process?

I should not have been surprised by this, but decisions are made by human beings. And so it's not as like a formal— no process is as formal as you think it's going to be where someone, your champion inside the company or your investor at every stage, someone gets a conviction that it's a good idea and then things just happen. I still sometimes expect it to be very like rigid, structured, and there's a lot of figuring it out as you're going. No matter who you're working with, everything is different. There's some legal terms to figure out. Your lawyers were actually a Perkins. We were a Perkins client. Perkins helped. We had an M&A banker help us, and there's a ton of just crossing the T's and dotting the I's. And it doesn't really— it isn't really done until it's done. So it was like there's a little bit of anxiety up until the day you sign the documents and then it's done in about 40 minutes. And that was just surprising to me. It was like, oh, it's finished. Someone woke up, our CEO woke up at 6 AM, signed the papers, and it was done by 6:45. And then we had to roll it out to the team and do all the integration and stuff. But it was like 8 months or 9 months that built to like 20 minutes of being finished.

The thing that really weirded me out was the concept of a signature escrow. Like everyone signs and then suddenly they're released and then the deal is done. I was on a subway when that happened.

Yeah, exactly. It was like, actually my birthday is in this month. So it was like the day after my birthday, like I had a birthday party and everyone's like, what's going on with your life? And you're like, uh, and you can't say anything. And I work with a bunch of my friends and then we had a Sunday night, like we had to do all the deals and we had to sign some extra documents and blah, blah, blah. And then Monday it was like, Okay, we're green light or Monday or Tuesday or something.

It's like we're done.

And then we rolled it out. So to your point, it was just, yeah, like, oh, it's finished.

Does this resonate with other folks on the stage? The lack of structure, maybe?

I would say certainly the closing call because they're frequently at 6 a.m. California time so that the buyers can get the wires out. And also my experience, we get on the call and founders are also surprised when it's like, our signature page is released. Yes, is the wire being sent? It's being sent. Congratulations. And people are like, "Oh, we're done." I would say behind the scenes though, leading up to that 6:00 AM call, we on the legal side are like coordinating and exchanging signature pages and things so that when you guys get on the phone, it can be very quick.

Even people on our side did an insane amount of work. Everyone is amazing. Maybe I'm susceptible to this as a person where you're like, when you're growing up, you're like, "Oh, the adults are very more organized. They don't procrastinate." You know, and when I was an academic, professors still procrastinate, you know? you know, it's the same thing where you're like, oh, this is actually just a human process. And so maybe that's more my feeling, less than it being disorganized.

I think that's where the magic happened in your process. It was X months before the closing call where somebody in NVIDIA decided we need to partner with these folks. And I think that's the easiest part to lose sight of. Maybe the closest proxy for those of you who are building businesses to sell into the enterprise someone's got to believe in you and want you to win the deal as a startup relative to some incumbent. And they're taking a bet on you. They're putting their personal capital, their reputation on the line. And one of the reasons customers churn is executive turnover. All the same dynamics apply to how young companies join big ones and figuring out that champion. Are you on texting basis with them? Are they giving you a back channel on how things are playing out and how to work the room? All of that needs to be there.

To that point, because when we started, when no one cared about what NVIDIA was doing, or comparatively like 2016, '17, we had had an ongoing path of observability to Jensen, and there were some meetings, and that was the relationship that ended up carrying some of this, and then some of the other executive staff at NVIDIA. And I think to your point that the seed was planted not even earlier that year, but 5 years prior or so, something like that.

Dan, you were recently on the other side of the table buying a business. How did that founding team build relationships with Mercury to the point where this was a no-brainer for you?

The acquisition we did was for accounting platform called Teal. A little bit unique. We had an internal thesis that accounting was a place that we wanted to play in. We thought it fit well with our product. So we started scouring like, hey, who are all the folks out there who are building more AI-based accounting? It's like a buzzy term right now, but you know, who are building like the next-gen version of QuickBooks or whatever else might be. And he spent a lot of time just building relationships with a lot of people. The founders at Teal actually said no to us at the time. They were like, hey, we might go fundraise, we think we're going to go raise at $100 million, whatever crazy valuation with no revenue. It's like, all right, good luck, maybe chat later. And it actually ended up coming back around just because we had that touchpoint. I think our vision of what this should look like was really well aligned. And I think that relationship building again, like it is very much a human process and how do you actually find the right acquirers. That believe in a very similar vision, a little bit different than fundraising. I think a lot of times VCs or so on are out there and you're telling a similar pitch to pretty much every single VC firm. When you are pitching to buyers, every single buyer will have a different purpose for why they care about you, right? Sometimes people just might want you as a founder because they think you're just so awesome of a person, maybe, right? Or other times it's, oh, we want the business, we want that distribution network that you built into a customer base, whatever it might be. And I think understanding why the acquirer is motivated to talk to you goes a really long way in actually figuring out what did people on the other side of the table really care about and how do you actually make them your champions?

I think part of that is the part that not disorganized to me, but it was like, oh, they're not really 100% sure how you have a lot of degrees of freedom in here. It's not like there's a standard, we're going to purchase you and slot you right here kind of thing.

So what I'm hearing, plant seeds early, maybe years in advance, build something important, relevant, or understanding what other companies might see you as strategic and treat it as a true sale where you're personalizing your messaging to your target. Okay. Couple of questions. We'll do rapid fire across the room. What are the key moments where deals fall apart and what red flags should either the buyer be looking for or should the seller be looking for? Michelle, let's start with you. Sure.

So where deals fall apart, I'm going to go to after you've got a signed sort of letter of intent, which is non-binding, but it outlines the deal terms. After you reach that point, you'll enter an intense phase of legal due diligence. And increasingly today, buyers, I would say both strategic and PE-backed, and, and those can overlap a bit because there are strategic buyers who themselves have like PE sponsors in the background. So many of the deals today that I see, even with strategic buyers, there's very intense due diligence. That's definitely a phase where transactions can fall apart. Some of the issues I see can be around ownership of IP. Let's say you had a co-founder who contributed to the technology, who then left the company, perhaps not on friendly terms, didn't sign the right documents, and is never going to sign anything again. That can lead to issues if you're not in compliance around tax or other applicable laws.

I'll go one click earlier in the process in terms of getting to that term sheet. I'd say a couple of callouts. We touched on one executive turnover. Who's your champion to make this happen? They're the ones who articulated the business case. You lose them, huge issue, right? But maybe a couple of other ones to know. Companies are bought, not sold. And so meaning, I think, Dan, you touched on this. What's the strategic fit? What problem are you solving? And if you're important enough, hopefully you have multiple people you are talking to. Even if it doesn't start that way, you want to get to that place to keep the process honest. And so if you're in a single-threaded process, that is the biggest challenge because you have very little negotiating leverage. You can't keep your counterparty honest. And one of the red flags, I think that was a phrasing Claudia would be like, the deal terms keep changing. It's like, ah, you know, we had said $250, but let's say $180 because we found this, this, and this. And when you feel that happening, the certainty of close, getting to an outcome, super low. In fact, you might be distracting your team. And as founders, if the deal falls apart, now you have to deal with a management team that feels deflated, demotivated. And that is a real issue. So I would say if you don't think you can get to high conviction with one buyer, or better yet, an auction process, don't do it. The probability of the deal disappearing is very high, and you took your eye off the ball on scaling your business, and there's a whole bunch of team and morale issues that come out of that.

I'll talk about it from the acquirer perspective. For us, Mercury has a pretty strong, unique sense of culture, like who we are. We actually bias really heavily. Towards hiring and acquiring folks that we feel like— we've only done one acquisition, but it was like a really big part of our filter for— of acquirers will be told when they're looking for M&A advice is it's usually people in integration where acquisitions fail. It's not usually within the deal terms or like the structuring of the deal itself. So we spend a lot of time going through not only understanding like the technical abilities of engineers, but are they just right, the cultural fit. Are the leaders that the founder have brought on board, like the type of folks that we see being leaders at Mercury as well. We go pretty deep on the talent assessment side. I think if you feel shaky about your team, that's all going to come out during the deal process as well. So I think if you're building a company, regardless of whether it's for sale or not, you obviously want to surround yourself with good people, but that's going to be scrutinized even more so of like you yourself as a leader, how you hire people, how you motivate people during the deal process itself.

Yeah, I agree with everything everyone said. I'll take a slightly different point. I think this can fail both before the acquisition and after the acquisition, to your point. So I always think about it as like immune system rejection. But I, I think that's one place people can pre-rule it out. They can see like, oh, the team is great, but it's not gonna fit because of like XYZ reasons. And I think that's one way it falls apart is they're actually really excited about you. Maybe the team's a little bit too big, the price is wrong. They already have a team that matches 40% of what your team has. Then it's like, well then we're only gonna take 30% of the team. Do we really want 30? Your corp dev teams or whatever are looking like maybe we just hire the people that we really want. You know, like they're playing that process. And then if you, succeed in that, you can also fail on the other side, which is the number one advice I got being acquired is making sure that you actually find a way to find some wins inside the company and get integrated. Because I've heard many stories of people getting rejected immediately for this reason. It turns out the culture wasn't a match, or there's a bunch of politics, or people show up and try to undo a bunch of decisions that were already done. So I think those are the two things that I've seen on the founder perspective fail the most.

In terms of team, pulling on the thread that you started, Dan, Jared, how do you think about managing your team that's working and building that might not know an acquisition is happening? Do you tell them sooner rather than later? How do you manage that piece?

In the period that we were stuck because we had some like quiet close conditions, so we had to be very careful about, uh, because there was a lot of, um, DOJ scrutiny, etc., stuff going on at the time. Like, I think anyone we talked to wanted to be very quiet. So that was actually the hardest part because if you work in a small company, we were like about 100 and odd people when we got acquired. I convinced some of my best friends to join. Some people that joined became some of my best friends. And besides the management team, it was like radio silence for 60 days or 80 days and even longer of us knowing that we were doing it. So I think smart people are very good at figuring out what's going on. People are like reading calendars and stuff and like interpreting what's going on. All of that said is you have to walk a fine line of letting people know that there is some good stuff happening because like in those periods, like we were also talking about fundraising, like there's a level of base anxiety of what is going on, what does the future look like? And so I think just trying to manage everyone's morale and give them some hope, it's a lot of the like soft human side of managing a team, I think, in those periods. So So I think that was hard. And then even through the acquisition, it's like a grief process for people where there's joy and hope and people have all kinds of different reactions through it. And even as the deal terms and the reality kick in, so that I think that was really challenging on the human side. Like you have to take all the management muscle you've already built and like apply it to everyone.

Andy, we'll start with you. What do you wish founders did more of to set themselves up for a successful transaction?

I'm guessing everybody on stage has a point of view on this, because we've circled this idea of long-term relationships in a few different ways. For the most part, for the type of acquisition you'd be excited about on behalf of teammates that have become friends or friends that became teammates, it started because you solved a key product roadmap gap for somebody with deep pockets. And that means 3, 4, or 5 years before the actual outcome, you were having conversations on how you would accelerate their roadmap, why partnering with you was better than building internally. You probably had to overcome some political drama in that big company because if it was on their roadmap and they chose to partner with you, that means there was an internal team building the same thing and you had to convince the company that your product was better. And then the best version of that type of momentum ends up being white label integrations or proprietary integrations and ideally some joint go-to-market. And then the upshot of all of that is this is a no-brainer. Instead of paying these guys a 10% rev share, we should own the whole pie. Let's acquire this incredibly talented team. Long story short, figure out who your best distribution partners would be. And how to get that distribution leverage. It helps you in the short term with growth rates and revenue and all of that goodness. But that is also the likeliest source of somebody knocking on your door wanting to buy you. It probably isn't like a moonshot that comes out of nowhere. The one time I've seen that happen, and I don't know if you can control for this, therefore it's not worth spending a lot of time thinking about, is a category goes in play. Somebody buys one company, the person who lost the first transaction way overpays for the second transaction. A good classic example of this, I think Salesforce bought Demandware for like a billion and a half. That became Salesforce Commerce Cloud. Adobe then turned around and paid like $4 billion for Magento, which makes no sense. Magento is an SMB business. Adobe is heavily enterprise. And if you're Magento, with full respect to Vista, because I think you guys benefited from that pretty nicely. You're just so grateful that you got hit with the lucky stick. There was no prior integrations. That happens, but you can't count on that other than wanting to be in a category that has multiple players who are all doing well. That's a healthy category. Those are the categories where sometimes that movie plays out. Otherwise, partnerships with your biggest distribution partners.

Amazing. The threat of long-term relationship. Super important. Your relationship with your investors is a long-term relationship, and oftentimes founders have a hard time broaching the subject with their investors, even if they have a great deal at the table, or this is something that deep down they really want to do because the team's burnt out, or they maybe have questions around how the market's changed. What advice would you have for founders in broaching this topic with their stakeholders?

I think the way that you play is so consequential to how that outcome plays out, where prepare for the leak scenario even while you're really early, just exploratory phases, right? When you're thinking about signing a term sheet, like at what point do you tell employees and so on? And I think the way that you manage that process as founders, like you all have reputations as well. Those founders, like you typically found multiple companies over time unless you have someone big hit. And that reputation does follow you through investors, employees, right? Your current employees are probably your network of folks that you really trust and want to work with again. So I would just say take care of your employees, take care of your investors. When you're going through a sale process, it really feels personal. This is your baby that you're selling, but there are also a lot of people who've signed up their livelihoods and like their relationships to be part of that journey with you, whether it's on the investor side or on the employee side. So just take care of them. I know like sometimes it could feel like a little bit of a fixed pie, but it pays dividends in the long term if you do want to be successful.

That's great advice.

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