Culture consideration

M&A deals aren’t just paper-and-pen transactions

This month’s issue focuses on dealmaking — one of the most significant decisions a person can make regarding their company. It can’t be taken lightly and requires a clear head to execute successfully.

As we bring more focus on dealmaking through our Dealmakers email newsletter and digital publication, and through events such as this month’s ASPIRE Conference, we’ve had conversations with some of the area’s top dealmakers. One of the aspects of the deal that they commonly emphasize is the human element, whether that’s embodied in the person sitting across the negotiating table, or the employees who are the engine driving the business.

No doubt the financial factors are a major consideration. Dealmakers look at the industry and its opportunities, intellectual property, equipment, etc. But they also look at management, and equally as important, the company’s culture.

Buyers are walking the floors of the businesses they’re buying, meeting the people to better understand their strengths and attitudes, and whether and how well that culture will mesh with theirs.

In February, Aaron Grossman wrote a column for Dealmakers on how culture shapes the M&A strategy of his company, Alliance Solutions Group. In it, he wrote about Alliance’s plan to execute 29 transactions in the next decade.

“We have reviewed well over 100 companies since 2014, and we have only moved forward on three of them. Each of these acquisitions has been successful up to this point, and I firmly believe a strong alignment to culture has been the driving force behind each success story,” Grossman wrote. “As we continue to refine and improve our culture, we will continue to understand how to assess this in the diligence process. With a goal of becoming a billion-dollar company in the next 10 years, we know we have to be great at figuring this critical piece out.”

In the pages that follow, we highlight the advice of those who have been there and done that to understand how they see deals, what they believe is important, and what they do after the transaction to ensure the strength of the business.

Adam is interested in the people and businesses making a difference in Akron/Canton.