M&A as an Exit Strategy: The Executive Leadership Dimensions

by David Nosal - Managing Partner (October 2014)

Twenty years ago, an initial public offering (IPO) was considered the gold standard for success in the start-up and business community. The IPO was a liquidity event that held a certain cachet and garnered the respect of senior business leaders across industry lines. However, with the dot-com bubble and subsequent crash in 2000, the resulting Sarbanes-Oxley Act of 2002, and the financial crisis in 2008, the regulatory environment for public companies became more stringent than ever before, forcing many organizations to devote more time and money to complying with new regulatory demands. As a result, some organizations began to second guess the ultimate goal of going public. Still wary of the risks associated with an IPO—increased public scrutiny, regulations, and the costs related to SEC compliance—many of today’s entrepreneurs are building their companies with multiple end-game strategies in mind, including merging with or getting acquired by another organization.

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