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In Deal Process

Surprises During the Process – Alex Chircop, Ondat Co-Founder/CTO

Tags: #2023 #cloud computing #cloud management #Kubernetes

Alex Chircop, Ondat Co-Founder/CTO, details what was one of the biggest surprises for him during the acquisition process.  Ondat, with GrowthPoint engaged as its exclusive financial advisor, entered into a definitive agreement to be acquired by Akamai Technologies Inc. on March 2, 2023.

“One of the big surprises was how much work actually happens after you sign that LOI, after you sign that initial piece of paper. You think that there is a certain amount of finality to that, that you’ve hit the milestone, but it turns out it’s actually 80% of the work that happens afterwards. And some of that is down to complexity with finances and complexity with due diligence.

I had done due diligence during funding rounds and let me tell you, an acquisition due diligence is very, very different. I think we peaked at 700 different questions, each of them requiring documents and lists and analysis, often going back four or five years’ worth of data. That was hard. One of the other things that surprised me was some of the complexities in things that come up during that process.

You can’t assume that you can keep everybody on side all the time for the whole period and the saying that was drilled into me by GrowthPoint was “time kills deals and everything you do that takes more time adds a ton of risk”. And we certainly saw that, you know, relationships became strong and then hit speed bumps and, challenges happen because things are taking longer and you have to deal with them and Growthpoint helped us not just in terms of getting the data and presenting the data and helping us in how to manage that process with the acquirer, but also helping us with kind of being the same person in the room when things were getting emotional because people had worked too many 15 hour days in a row. Everything becomes very personal for every single investor and every single board member and every single employee.

I think GrowthPoint were the rational person in the room, and they were able to say, “actually, you know what, this is normal”. I’ve had a number of calls with some of the partners from GrowthPoint where they said, “you can expect this to happen and even expect this person to say this”. And inevitably they did. And it helped to know that it was par for the course and not something to get emotional about.

We had to make a number of compromises in the end in order to make a number of hard decisions in terms of making sure we got things done fast. And certainly after the deal closed and after we joined our acquirer and we got to speak with some of the team that’ were working on the inside, we certainly saw their ups and downs and how they were working, their business justification and how they were getting board approval and things like that. So yeah, the surprise is definitely making sure that that process goes smoothly, and you keep it as short as possible.”

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