𝗦𝘁𝗮𝗿𝘁𝘂𝗽 𝗔𝗰𝗾𝘂𝗶𝘀𝗶𝘁𝗶𝗼𝗻𝘀 𝗗𝗼𝗻’𝘁
“𝗝𝘂𝘀𝘁 𝗛𝗮𝗽𝗽𝗲𝗻.”
𝗧𝗵𝗲𝘆’𝗿𝗲 𝗘𝗻𝗴𝗶𝗻𝗲𝗲𝗿𝗲𝗱. 𝗬𝗲𝗮𝗿𝘀 𝗶𝗻 𝗔𝗱𝘃𝗮𝗻𝗰𝗲.

Most tech startups don’t IPO. They get acquired.

That’s not just anecdotal—it’s the statistical norm. IPOs are a rare exception, even for venture-backed companies. But too many founders treat M&A as a last resort: a move to consider only when capital dries up or growth flatlines.

Some even see acquisition as an admission of failure. But that couldn’t be further from the truth.

An exit is a success. Success comes in degrees—and timing is everything.

The best exits aren’t reactive. They’re architected.

They happen when founders start the process long before they need to. When they build relationships, craft a strategic narrative, and shape their business to be acquirable.

Here’s what that looks like, and why the most successful founders build toward optionality, not desperation.

Why Optionality Matters

Startup founders are taught to optimize for valuation. I’ve talked to founders who tell me that they didn’t consider M&A until it was too late because they were afraid to bring up the topic to their boards. They felt that the M&A discussion would be perceived as “giving up” or not believing in the business.

VCs on your board may have fund priorities that supersede yours. Some may push for the elusive IPO or maximum-outcome path because they need one or two big wins in their portfolio to return the fund. But that path may not be optimal for you or your shareholders, and your company may not be suited for that kind of outcome.

This is something you should feel to discuss with each of your leading VCs. You will likely find that each of your VCs have different outcome priorities. For example, your Seed stage VC may be looking for an exit sooner than later (their entry price is the lowest, and the tenure the highest). Your latest VC may be looking for the maximum outcome with patience (entry price the highest, tenure the lowest). And most of your angel investors are probably looking for liquidity as soon as possible.

Navigating all these various outcome priorities is challenging, and it varies over time.

The founders who win in M&A optimize for optionality — the ability to choose between raising, scaling, or exiting on your timeline, not the market’s or your investors.

Architecting an exit isn’t a last-minute move. It’s a multi-year strategy, executed quietly and in parallel with growth.

If you wait until you need to sell, you’re already too late. A “for sale” sign kills leverage. Even fast exits often take 12+ months of groundwork—narrative, relationships, and timing.

When to Start Thinking About It

Here are signals it might be time to get serious about M&A planning:

• Growth is slowing, and the solo path looks harder
• Raising more capital doesn’t pencil out
• Cash is tight, and leverage is slipping
• Team dynamics are shifting
• A strategic partner could accelerate your roadmap
• An unsolicited offer lands below your “magic number”
• Your investors are nearing the end of their fund

None of these are reasons to sell now. But they’re reasons to start laying the groundwork.

How to Engineer Your Exit: A 5-Part Approach

Here are the steps we walk through with founders who want to be ready when opportunity knocks—or better yet, when they want to create the opportunity themselves.

1. Identify Your Likely Acquirers Early

Start with a tight list of 6–12 companies. Look for acquirers with strategic gaps your product fills. This is not a logo wall—it’s a focused, realistic target list.

What to look for:

• Companies already selling to your target buyers – this will help build a revenue generating partnership for both parties.
• Strategic shifts in market expansion, product coverage or financial priorities – you want to find strategic gaps that you can fill for them.
• Companies that need to move into your category to defend their core business – this is where you turn a potential competitor into a partner.
• Lead investors who influence strategic direction – reach out to the lead investor of each of your target companies as they tend to lead M&A initiatives for their companies.

When you know who your prospective buyers are early, you can shape your roadmap, partnerships, and positioning to fit their narrative.

2. Decide What They’re Buying

Acquirers don’t buy startups. They buy leverage.

You need to work with each target company to identify the leverage that you can provide them. This ensures that your valuation is driven by the value of what they can build with you, rather than a generic multiple on your revenue.

Your goal is to become strategically indispensable in one of the following ways:

• Product accelerator: You’ve built something they’d need 18–36 months to replicate.
• Distribution wedge: You unlock a customer segment, channel, or geo they can’t reach.
• Data advantage: You own proprietary data or signals they can’t organically collect.
• Team capability: You’ve built a team with expertise they lack.
• Category position: You block a competitor from owning a priority space.

Define your acquisition archetype, and then reinforce that story across everything: GTM, pricing, marketing, product roadmap.

If you don’t define the value story, their Corporate Development team will—and you won’t like their version.

3. Build Relationships Before There’s a Deal

By the time Corp Dev reaches out, their narrative is often already made. Your job is to get on the radar early through executive-level familiarity to help them shape their narrative around the value that you may bring them:

• Product management – this is typically the best place to start in order to find where product alignment may exit. Product managers have product and revenue responsibility and they tend to lead strategic growth initiatives.
• CEO-to-CEO and VP-to-VP informal syncs: after confirming a mutual opportunity, start to build relationships across the organization that would benefit from your product.
• Product and GTM roadmap alignment with their team – prioritize co-selling partnerships that can drive revenue for you and them.
• Joint GTM partnerships that drive real revenue – their sales leadership needs to see evidence that their teams can sell your products.
• Narrative-building with their lead investors – PE firms that own a majority of the target typically lead M&A initiatives on behalf of their management team.

This isn’t pitching. It’s strategic alignment and relationship building.

4. Control the Narrative Moment

You only get one shot at high-leverage positioning. The most attractive acquisitions happen when the stars align—when you’re showing momentum, and your strategic value is obvious to those watching from the outside. If you’re cultivating the right relationships and guiding the narrative, this is the moment when inbound interest tends to surface.

There’s a window where your leverage is highest:

• Growth is accelerating – preferably including revenue from co-selling with the acquirer
• Competitors are making visible moves – you need to make sure you’re better positioned
• Strategic overlap is obvious – obvious from the acquirer’s perspective, not yours
• Your story is showing up in their boardroom – because you’ve helped craft it with them

That’s when the conversation shifts from “partnership” to “what if we did this together?”

Wait too long, and you’ll be negotiating from weakness. The goal is to sell while you can still walk away.

5. Make Yourself Easy to Buy

Friction kills deals. Not disinterest.

Even when the strategic fit is strong, deals fall apart in diligence. Not because the acquirer lost interest—but because they uncovered friction, gaps, or surprises that changed the risk-reward equation. Founders who stay acquirable at all times can move quickly and credibly when opportunity strikes.

Sometimes, friction is uncovered by the Corporate Development group once it gets involved. This group is also typically tasked with negotiating the acquisition deal, so they are motivated to uncover friction and issues. Make sure to keep very close to the business executives who are sponsoring the deal so they can help you navigate the Corp Dev dynamics. This is also where your M&A banker earns his fees – I can’t stress this enough. Use a banker!

To be continuously acquirable:

• Reduce burn, ideally to breakeven – once you make the decision to actively pursue an exit, you need to show a clear path to breakeven.
• Build a clean data room like you’re raising a round – I hope you already have a CFO to do this – if not, why not?
• Get legal house in order: IP, contracts, employee docs – your law firm should guide you and this needs to be done three months before an exit.
• Engage with M&A bankers early, and retain one when you’re ready to run a real process – Bankers earn their fee in valuation and deal dynamics. Don’t skimp.

Final Thought

This isn’t about giving up. It’s about giving yourself more than one good path forward.

The best exits don’t feel like sales. They feel like the next logical step in a strategic partnership you’ve been building for years.

You’re not for sale. You’re in demand—because you planned it that way.