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On December 9th, Venture Archetypes and Greenberg Traurig pulled together a panel of some of the top entrepreneurs and most active acquirers in Silicon Valley to answer your questions about start-up M&A. So whether you’d like to know what the serious players are looking for or how to position your start-up for a healthy acquisition, you’ll find the wisdom right here!. Read the rules.
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Regarding offers, how do you decide on cash versus Equity? What are the different considerations?
Asked by John Chu

Panel Answers

Elad Gil
Twitter (sold Mixer Labs)
One acquisition structure that some companies have started doing, which is one of the things that Naval mentioned, is splitting the founder and investor incentives. The investors receive a cash return and the founders and employees are given stock. Sometimes that happens as well.
Amin Zoufonoun
Director, Corporate Development
Part of the decision for us is the cost of each from our side and what you’re looking for. Obviously we’re a cash rich company so cash is relatively cheap for us versus diluting our stock more. I think for Facebook it would be the opposite…maybe not.
Michael Brown
Manager, Corporate Development
We just do what the Entrepreneur wants mostly [laughter]…it’s sort of true actually. If we’re willing to pay $100 for a company – obviously I’m using silly numbers, then that’s what we’re willing to pay. So if someone wants cash because they need to buy a house or pay XYZ loan, that’s fine. We still want people to vest and want people them to be there for time, but we don’t really care.

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