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Advice for Surviving a Buyout?
Anonymous for Good Reason asks: "I'm working for a small-medium sized software company that looks like it's going to be bought by a much larger company. We (employees) aren't being told anything yet, but the behavior of our management and some of the information we have been asked to provide all make it pretty clear that somebody is going through due diligence and trying to close the deal. How have other people fared during these kinds of buy-outs? What did you do to make sure you kept your job and weren't RIF'd after the dust settled? How did your stock options, pay, benefits, etc transfer, and was there anything you would have done different to protect yourself? Was the cultural change a problem, or were you welcomed warmly into the fold? I'm mostly interested in stories from people whose companies were bought by the really big players (IBM, MS, Sun, CA, HPaq, etc.) since that's what this will probably be. Since I have never been through a merger of this type, I'm not sure what to expect and with the current economy I would like to increase my chances of staying employed. Any insight the Slashdot crowd has would be interesting."
I worked for a small privately owned ISP which was bought out by a larger local ISP. There wasn't any transfering of shares to worry about, but we received stock options at the new company and our pay remained the same. After 60 days we all had to option of staying or going and most of us stayed. A year later a nation-wide telecommunications startup bought us and again, pay remained the same although we got screwed on stock options. This telecommunications company let us sit and waste away while they were trying to figure out why they bought an ISP concidering they had no clue how to run one and 8 months later the layoffs started. The layoffs never stopped. They continued until the day that the doors on our office were closed and the telecommunications company pulled out of the state completely. I got out before I was laid off as did my girlfriend, but I had friends who are _still_ unemployed and that layoff was almost 2 years ago.
I sincerely hope your experence is better.
blah blah blah....
drightler@technicalogic.com
Many times employees of the smaller company decide that working for a big company and dealing with the bueracratic nonsense sucks and jet. Particulary when the buying company is a big, old company like (the former) AT&T, IBM or the like.
There are plenty of examples of this out there.
Conformity is the jailer of freedom and enemy of growth. -JFK
One question you might want to find the answer to: Why are you being bought? If it is so that the larger company can aquire a technology of yours, then your future does not look so bright as if you are being bought for your person-power.
J'aime mieux les méchants que les imbéciles, parce qu'ils se reposent. -- Alexandre Dumas
The big guys are working deals so they'll be rich, and you won't even figure into their plans. They may throw a bone at you to keep you from leaving thru the transition, but they do not have your interests in mind. BC
Read This - Who Moved My Cheese? An Amazing Way to Deal with Change in Your Work and in Your Life by Spencer Johnson, Kenneth H. Blanchard
Big company buys small company -- most likely for small company's tech, or customers, or what have you.
Big company institutes its policies on small company, perhaps cuts some of small company's redundant staff -- small company's HR department, for example, goes bye-bye.
Small company is now dependant on big company for resources, like HR.
Attrition begins on small company: if big company is doing layoffs, small company has to do layoffs with it, but small company doesn't get many (if any) new hires.
Small company, which now has less employees, can do less, resulting in big company treating it like a liability and stepping up the attrition rate.
Small company eventually folds, with any remaining employees fired or relocated to wherever big company is.
Long story short, big company buys small company because small company has something it needs. Once it has it, it doesn't need small company beyond a short transition period, and it's not going to keep small company around.
Yes, I'm cynical.
You'll see layoffs in HR, Finance, and Accounting first - these departments are nearly identical across all companies. If you mainly do work for one of these departments, get transfered. Then come the easily digestible IT departments: Networking, Desktop support, Help Desk, etc. Day-to-day Ops Application support is usually safe for a while. Developers, DBAs, and SAs it depends. I've seen a couple of companies layoff all the SAs & DBAs and add those duties to the Dev staff.
Just a word, it can take years before the effects are known. I used to work for a company that wa sbought out. 7 years latter the parent finially admited that the salemen would never sell the (good) products that the smaller company had, and got rid of everyone. Of course in 7 years most of the work force in the smaller company had changed just because few people stay on that long, so the people affected are not the people who were there when it happened. All along they funded some good engineering.
It saddens me to think that people have been conditioned to think this way. Saddens and sickens me.
My first "Real" job out of college was with a small software firm. It had about 50 people, about 40 locally and the rest in remote offices scattered around the country.
The synergy of the employess struck me as awesome. The people were an eclectic mix of various techinical and educational backgrounds and personalities. Everything simply worked.
The driving force -- no, the soul -- of this company was the owner. He was the most genuinely good man I think I've ever known. Everyone thought the world of him. The big story was that in the earlier days of the company, he took out a 2nd mortgage several times to cover payroll until sales picked up!
When times were lean, we didn't mind not getting raises or top notch pay because the workplace was so great and we knew the owner would take care of us when times improved.
While some true deadwood and/or bad apples got cut occasionally, there were never any layoffs for the sake of keeping the company afloat.
Some business owners may say it's foolish for the captain to go down with his ship, but I respected that attitude. The guy already had enough money in the bank to float a long time if the business ever folded. So he knew he had "enough" money and actually cares for the well-being of his employees.
That said, I would have stayed with the company until the end -- all of us would have. It was a true two-way relationship.
Sadly, tbe company merged with another larger one (~250 employees). The new management sucked ass. The customers balked. We employees balked. But the former owner was pretty much powerless to resolve anything at that point. While he thought he was benefitting everyone (and we all did, too -- I myself was a poster boy for the merger), it appeared in retrospect that the larger company simply wanted our (very loyal) user base and didn't give a rat's ass for the assimilated employees or customers, as it pretty much shelved our software and most of the original employees from our company.
I aspire to one day, if I ever run a business, be as good a man as the one I once worked for. If every owner was like this, this country would be a better place for it.
Method of processing duck feet
I, too, am a former Cobalt employee. And I have to agree with everything... Sun never understood what the Cobalt / Linux model could do for them. That's the worst part of a buyout/takeover - big companies can buy a smaller one for one small idea/product/etc, and just shitcan the rest without even thinking about it.
Steven DeWitt (former Cobalt CEO) did a masterful job of selling the company and the vision to Scott McNealy, just in the nick of time, and made himself and the top Cobalt execs a boatload of money. I don't begrudge him that at all -- probably that move kept Cobalt 'afloat' for longer than it might have on its own. But Sun just wasn't the right place for Cobalt... Apple or SGI probably would have been better, as they are a bit more "creative"...
So watch your step... if you're already questioning whether you might have a future there, you probably ought to at least brush up your resume and start seeing what else is out there...
And good luck to you, whatever happens!