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Mergers and Acquisitions

Discover the roadmap to achieving liquidity in the post-internet age through mergers and acquisitions. Learn from a seasoned industry expert, Michael McNamara, as he shares insights on company growth strategies, IPO criteria, and successful acquisition approaches. Explore company stages and ideal combinations for business success. Find out where to find partners and how to navigate the complex process of merging companies effectively. Benefit from valuable tips and lessons learned from successful acquisitions like Cisco. For inquiries, contact mac@verisity.com.

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Mergers and Acquisitions

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  1. Mergers and Acquisitions the road to Liquidity in the post internet age Michael McNamara Senior Vice President, Technology Verisity Design

  2. Background • I was a computer architect in the 1980s… • Co-founder of an EDA company in 1992 • Merged it into Viewlogic in 1994 (now Synopsys) • Started another EDA company in 1996 • Merged it into Verisity in 1999 • Verisity made its IPO on 3/21/01 as VRST @ $7 • Stock has done well since then

  3. Sometimes you hit… • A Home Run • Cisco, Apple, Yahoo • Some times just a double • Or you strike out • If you get on base: make sure you score! • How do I do this?

  4. Review: Criteria for IPO • Growth Market • Revenue • Profits • Experienced Management • Merger capable

  5. How to Grow a Company • Growth by Acquisition (A) • Most explosive (!) • Growth by Focus and Execution (F&E) • Always needed • Growth by Joint Sales and Marketing (JSM) • Collaborative • Growth by Development of Additional Products (DAP) • Predatory, Expensive

  6. Acquisition • How to acquire • Many professionals will be happy to help you • Whom to acquire • Minimize pain, maximize gains • How to be acquired • Timing and fit are important • It’s good to be on the winning team

  7. Company Stages • 5: Growth • Sell. Build. IPO? • 6: Steady State • Own a market • 7: Conglomerate • Acquirer • 8: End of Life • 8 track tape • 1: Idea • Two guys, a garage • 2: Proof of Concept • Above + a demo • 3: First Customer Ship • Someone will buy it! • 4: Proliferation • Get channel

  8. Good Combinations • Growth + First Customer Ship • It works! Little overlap; still some risk • Growth + Proliferation • Market exists; some channel conflict • Conglomerate + Steady State • More revenue; Economies of scale

  9. Not so Good • Growth + Idea • All risk, when revenues are needed • Growth + Growth • Internal fights • Anything + End of Life • Buying a name

  10. Where to find partners • The singles bar… • Trade shows / magazines • Partnership Programs • Adjacent markets • Extend the reach of both companies • Don’t merge with a competitor • Now the fights will be internal!

  11. How to merge • Signing the docs is the first step • It will take longer than you imagine • Focus on cementing the union • Fly everyone to the other office • Transfer people between the old companies • Be open to new directions • A.E. becomes Sales; Engineer becomes Tech. Marketing • Study those who have done it well • Cisco

  12. Thank you for your time • Questions? mac@verisity.com

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