Startup discussions usually include talk about how every CEO dreams of their company going public or being acquired. In many ways, it mirrors the discussion you have with every random, wine-sipping stranger at a friend’s party: What do you do now, and what will you do next?
That discursive framework leaves out a few important pieces, though. First of all, we skip right over what this person really wants and loves. Discussions centered on “what’s next?” only briefly alight on what makes us happy. Second, it overlooks all the moving parts around us that make our lives bearable—or our businesses profitable.
In late 2015, Capterra was acquired by IT research and advisory firm, Gartner. In the subsequent months, a lot of interesting things happened around the office. None of them were the sorts of things that founders are allegedly always dreaming of: huge paydays, tons of press, and wearing hoodies to stock exchange openings, for instance. They were the things that make life the weird, textural mess it is.
Today, I want to focus on my experience of working for a company that’s been acquired so that you know what to expect on the front lines. I’ll give you a quick summary before we dive in:
- Some things I like have changed
- Some things I like have stayed the same
- I didn’t buy a yacht
There are a lot of moving parts, emotions, and hurdles to overcome, but the company has been around for over 15 years and has one of the most level-headed founders around, so things are pretty good
Lesson 1: Acquisitions are personal
I was on vacation out on Maryland’s Eastern Shore—it’s more charming than it sounds—when Mike, our founder and CEO, announced we’d been acquired by Gartner. Before I left, I had told my coworker to let me know if anything interesting happened while I was gone.
“Like, if we go out of business or get acquired,” I’d said.
Yeah, I can see the future. (Image credit: Ed Schipul)
I woke up feeling weirdly anxious and made my wife drive around the small town of Easton, Maryland searching for Wi-Fi so I could check my email. At this point, I’d been with Capterra for less than a year, and the content team was just five people strong.
In what seemed like a handful of minutes, we went from being 5 out of 50 employees to being 5 in over 8,000.
Lesson 2: Acquisitions don’t happen overnight—they take time
Retrospect is an odd thing. In July 2015, just months before the acquisition, I had written to Mike to say I’d noticed that Gartner was buying up some of our competitors, and it looked like there was a new, consolidated competitor coming down the pipeline. I had no idea that competitor would soon be our closest ally.
I sent that email a day after Mike met with Gartner, by the way.
Back in Easton, I was sitting in the front seat of my car trying to parse the little information I had. I remembered I’d brought along a copy of the options plan Mike had just rolled out (thanks, Mike) and dug through my backpack to try to find it.
So we sat in the parking lot of the Rise Up coffee shop and read through pages of legalese while I tried to sort out what this meant for me. The previous day, I had celebrated my son’s second birthday. He was napping in the back seat while I did all this pondering.
Would I still have a job? Honestly, that was the sum total of my pondering.
Turns out, I did have a job when I got back. Mike was very good about making sure us Capterrans were treated well during the transition. In movies, the hero thinks up a good idea, sinks a couple million bucks of other people’s money into it, then sells it and move on.
The story always focuses on the Zuckerberg or Musk or Bezos character, because they’re the people in the story who drive the action and tension. In real life, there’s a lot of infrastructure and humanity left behind after a sale.
Lesson 3: Acquisitions aren’t cinematic, and they don’t all look like Instagram
In Capterra’s case, the sale wasn’t something we’d been courting for long. Mike kicked Capterra off back in the ’90s and ran the thing on the back of his own checkbook—well, credit card, I guess—all the way.
From my email to the announcement, there were just two months worth of operations. In that time, Gartner vetted us, we vetted them, everything was drafted up, and the ink hit the paper.
My favorite filing system. (Image credit: Rosemary Voegtil)
This isn’t always how it goes. Back in 2012, Facebook picked up Instagram for a cool $1 billion, but only after over a year of Instagram rejecting potential suitors. It was a huge payday for 13 nonfounding employees at the business, who reportedly split $100 million.
Lesson 4: No amount of reassurance calms all fears
For Capterrans, the focus was much more on how things would work after the acquisition. We put aside the job loss concern after Mike explained the basics. At that point, I think most people were wondering:
- Would we have to wear button up shirts and suits? This is not a joke concern, by the way.
- Would we be moving offices?
- What would happen when redundant functions were inevitably found?
- How much freedom would we have to operate?
- Would being bigger mesh with our agility?
The split was close to 50-50 personal issues and business issues. Regardless of the concern, there is nothing more comforting during an acquisition than having a CEO or manager you’re confident is looking out for you.
Good leaders act as avatars for their employees, representing them when they can’t represent themselves. Keep in mind that, in some cases, there’s not going to be anything a good leader can do. If you’re in accounting at a small company, and you’re purchased by a large company with an existing accounting department, you might just be out of luck.
In the other cases, such as Capterra’s, the key to assuaging fear is communication. Mike opened up the gates for feedback and questions, and we took advantage of that.
Lesson 5: The more things stay the same…
We still wear shorts and hoodies and flip-flops. Despite my best efforts to institute some suits in this place, my boss still rocks his bacon-themed t-shirts a couple times a week. We also didn’t move offices; we expanded into the adjoining office space, as we had previously planned.
Also, because we ran such a tight ship before the acquisition, we didn’t end up with much in terms of overlap. One of our customer divisions did end up mirroring some work already done by another section of the business, but everyone on that relatively small team quickly found new homes within Capterra.
While the feeling and basic format of the office didn’t change, things did shift. Operationally, we had some major changes.
…the more they change
I think most of my colleagues would agree that both expenses and general administration became more complex. That’s to say, we used to just dump a box of receipts on Nadia’s desk, and now we use an actual expense reporting tool.
When we needed something, say, a video camera, we used to just talk to one person and then go out and buy it. Now, we must make sure it fits into the budgeting process. It’s hard to say how much those sorts of changes matter.
They’re the sort of things you think about in the back of your mind when you’re getting acquired. The bigger emphasis is on navigating a new structure and staying nimble. You don’t have time to worry about the big stuff, though, when the little stuff makes up your daily life.
Lesson 6: Being nimble is a mindset, not a business structure
“Nimble.” It’s one of those newly applied tech words. It stands for a lot of things: spending money quickly, hiring new people in a week, minimum viable product development, viral marketing campaigns, and the list goes on. What it really means is much more in the mindset that a business has.
Nimble companies are those that believe they can do anything, even with limited resources. Can we make an app for this thing before the conference next week? Sure, why not.
I would say we’re a little less nimble now, but we still have moves. Most of that change is due to the increased amount of planning we put into things. How much of that is from the acquisition and how much is a natural effect of growth is hard to say.
I was about the 35th person hired here. We’re now on our way to 90 folks in this office. With that growth, things have to change.
Universal change metaphor in picture form. (Image credit: Sid Mosdell)
Every startup hunts down change. The startups that have been running for 15 years and the ones that have been around for 15 months. They’re all looking to hit a point where growth spikes and they sell or go public.
Or—and this is a real consideration—they’re searching for the break point, where it becomes undeniable that the business isn’t viable.
We’re all looking for change, but change is never easy. I’ve now been a Gartner employee for 19 months. Things have changed, and they continue to change. There are times I miss the smaller company I joined, and there are times I love the scale of the new business.
Being acquired is the second most interesting business adventure I’ve been a small part of, just behind working in finance during the crash.
There are days I wish I could just appeal to one person for more budget, and there are days I’m glad to know how much money I’ve got to work with for the whole quarter. Days I miss our small crew, and days I love meeting some of the 1,000s of new people.
In short, there are good days and bad. Just like in any job with any organization.
Lesson 7: People are still everything
Looking back at all of it—the change, the fear, the relief, the money, the extra planning—I’m struck by something. Nothing that’s happened has been as important as the people I work with and the people I love.
I know that may sound trite, but I don’t really care.
Mike is still the Big Boss, and he still cares about every single person who works here. J.P. is still my boss and he still cares about language. Meeting new employees is still fun. Going out for coffee or a drink with someone who’s having a bad day is still important.
Of all the things that have changed, the biggest shift in my day came when my coworker-friend moved to San Francisco. Something so small and personal easily rose above the chaos of the acquisition.
These people are people. That person over there is a person. (Image credit: Incase)
Even on that first day when I found out I was now a Gartner employee, I lost sight of it an hour later as I carried my son through a butterfly garden.
People are everything. The people you work with and employ and serve should be the center of your day. If your company gets gobbled up or dies or goes its own way, congratulations/condolences. Put it behind you and find someone to spend your day with.
Capterra is still about the customers and the employees. As long as that doesn’t change, we’ll keep being us. Find your core and keep to it. Good luck.