An acquisition is a type of exit event for startups that occurs when your company is purchased by another company.
What is an acquisition?
An acquisition is when one company buys another company. The acquiring company may use cash, stock, or a combination of the two to purchase the acquired company.
How will the acquisition affect the shareholders of the acquired company?
The impact on shareholders of the acquired company can vary depending on the specifics of the acquisition. In some cases, shareholders may see an increase in the value of their shares due to the acquisition. However, in other cases, shareholders may see the value of their shares decrease or be completely eliminated. It really depends on the terms of the deal and the subsequent performance of the company.
How will the acquisition impact the employees of the acquired company?
The impact on employees of the acquired company can also vary. In some cases, employees may see little to no change in their day-to-day work or job security. However, in other cases, employees may see changes in their roles, responsibilities, or even be let go as a result of the acquisition. It really depends on how the acquiring company plans to integrate the acquired company's operations into its own.
