Venrock VC shares top 10 important tips for successful M&A - Business Insider

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I've seen common themes from successful M&A journeys during my 20 years as a VC. Here are my top 10 lessons for companies looking to get acquired. (by CamiSamuelsVC)

Cami Samuels is a partner at Venrock and focuses on healthcare. She served on the board of Corvidia, a biotech company that was acquired in a $25 million cash deal in June 2020.

I had the honor of serving on the Corvidia board and have gotten to thinking about the common themes that have emerged in the M&A journeys that I have witnessed over my 20 years as a VC — the last five of which I've served as a partner at Venrock. The two companies meet many times over months and years. Conversation and connection occur at multiple levels in both organizations like when CEOs chat, the scientists or engineers chat, or the BD people chat.Keith Leonard met multiple times with Brent Saunders over multiple years before Allergan's $2.1 billion bid for Kythera. BD and Corporate Development are almost never the ultimate decision maker for M&A.

Be open and honest about your company or product's limitations — every deal has warts. This builds trust and goes a long way in building relationships as I wrote above.Cultivate objective and respected advocates who have no financial "skin in the game." In biopharma, Celgene, Allergan, and Gilead have been recent assertive buyers. Back when Novacardia was acquired, there was a proactive buyer who bid, but Merck ultimately "won" the deal after they were galvanized to action by the other party.

Also, I have not seen a banker bring a totally new bidder to the table. Generally bankers just help galvanize a company that the team has already cultivated. The stereotype of the VC selling the company out from under the founders and execs is not consistent with my experience. Maybe I've just had good co-investors.

 

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