The Engineering Executive's Primer

Chapter 7. Participating in Mergers and Acquisitions

I managed the Engineering team at Digg as we ran out of money, and were eventually acquired. It was an eye-opening experience and I learned a great deal about the reality and the optics of selling a company, particularly one with no money and a shrinking user base. Humbling was just the beginning.

Since then, I’ve had the opportunity to evaluate a number of companies from the other side of the mergers and acquisitions (M&A) table. Most of those discussions didn’t move forward, but a handful did, and every discussion was an education in Engineering’s role in these messy processes. Acquisitions are filled with risk, with early discussions creating a great deal of anxiety for Finance, Legal, and People teams. Engineering has an interesting risk profile as well, and needs to evaluate the potential product value and integration cost of a potential acquisition.

However, and unlike many other functions, Engineering will be intimately involved after the acquisition closes, typically leading the integration and operation of the acquired offering. This incentivizes Engineering to be particularly careful in their assessment. While there are no prizes for diligently vetting acquisitions (often just a trail of annoyed colleagues), it’s critical work. Thoughtfully integrating a trajectory-changing acquisition is one of the most impactful things you can do as an Engineering executive, and stopping a poorly thought-out acquisition from moving ...