As CEO, preparing for an acquisition is not just about maximizing valuation. It is about ensuring the company continues to perform after the transaction. Buyers are not only purchasing your revenue and product. They are investing in the people behind it.
If they sense your team will lose motivation post-exit, the value of the deal erodes quickly. That risk is often underestimated, but it is entirely within your control.
Buyers think in terms of risk
When a buyer evaluates your company, they look closely at post-closing retention. Key team members are viewed as critical to post-acquisition success. To reduce risk, buyers frequently defer equity payouts for executives and technical leads. They see it as a way to keep the business stable.
But from the teamโs point of view, it can feel like a penalty. Those who contributed most may end up waiting the longest to receive their share. Meanwhile, others with less influence on the outcome may walk away fully compensated.
What makes sense from a buyerโs standpoint often creates internal tension.
Employees think in terms of recognition
For your team, equity is not just a financial instrument. It is a reflection of contribution and alignment. A late-stage hire who worked tirelessly to help close the deal may feel overlooked if their equity remains unvested.
Long-time employees often feel their commitment has earned them the full upside. These are not just differences in payout structures. They are differences in how people interpret fairness.
If the logic behind those decisions is unclear, resentment builds and retention becomes fragile.
Your equity plan sets the tone
The structure you create in advance shapes how the team responds after the exit. A plan with no acceleration favors tenure over impact. A plan with full acceleration may feel more inclusive but removes all post-deal incentive.
A middle ground, where partial acceleration occurs at exit and full acceleration applies only in a change-of-control scenario, often provides a balanced outcome. It rewards those who stayed the course without alienating those who made high-impact contributions late in the journey.
More important than the structure itself is how clearly it is communicated. People stay motivated when they understand how decisions are made and how they fit into the companyโs future.
Buyers want continuity, not just capability. A team that feels respected and fairly treated is more likely to stay engaged under new ownership.
The way you structure equity and communicate intent becomes a signal. It tells buyers whether they are acquiring a stable organization or walking into uncertainty. That clarity is what preserves value after the deal and builds your reputation as a founder who leads with foresight.
Itay Sagie is a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to Crunchbase News, and a seasoned lecturer. Learn more about his advisory services, lectures and courses at SagieCapital.com. Connect with him on LinkedIn for further insights and discussions.
Illustration: Dom Guzman
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