By Jessica Stillman (Editor, Women 2.0)
If your startup is almost out of money and more funding doesn’t seem to be just over the horizon, what are your options? You can keep grinding away at raising another round (despite the widely discussed crunch), cut the burn and bootstrap, close up shop or get acquired. But exactly how do you go about pursuing this last option?
“Everyone in startups knows how to raise money. There’s endless PowerPoints and workshops that you can go to. But there are very few people who actually know how to sell a company,” Jacob Mullins, a senior associate at Shasta Ventures and the founder of newly launched startup, Exitround, explains.
Mullins’ site aims to remedy that. A sort of matchmaking service for startups open to acquisition and companies looking to acquire tech and talent, Exitround asks founding teams to supply basic data on their skills, product and history. They’re vetted by Exitround (which relies on the work of others by filtering for those who have received angel, seed or venture funding or been through a top incubator). If they make the cut, their information is anonymized and served to companies as a soup of searchable data. If a company finds something that interests them, they can ask for an introduction. Startups are free to agree or refuse to meet them.
“Exitround pulls back the covers on acquisitions,” says Mullins, demystifying the expectations, process and pricing involved for founders. It’s not a bad deal for acquiring companies either, of course, who are desperate for talent and still rely on analog, labor intensive processes to acquire it.
Raising The White Flag?
It’s an intriguing option for a struggling startup, but will founders – famous for their never-say-die attitude – take him up on it? Mullins says he understands the difficultly of admitting it might be time to consider surrender.
“My first startup was a dietary supplement company. We did it for four years and I poured my heart and soul into it. Realizing that potentially it wasn’t going to work out was the most painful thing I’ve ever gone through. So I understand that emotion,” he says, but he suggests founders need to think of Exitround as less of a white flag and more of another tool in their belt.
“I don’t want to push companies to sell but if I can offer another option to the other things that they’re considering, that’s really what I want to do,” he says.
There are no geographic restrictions on teams (though you will be asked about your willingness to relocate), nor any rules as to sector or skills, though deep expertise of some sort is expected. If you’re curious, the application information is available here.
Women 2.0 readers: Do you think many founders will take up Exitround’s offer to help them get acquired?
Image courtesy Flickr user Images_of_Money.
About the writer: Jessica Stillman is a freelance writer with interests in unconventional career paths, generational differences, and the future of work. She writes a daily column for Inc.com and has blogged for CBS MoneyWatch, GigaOM, and Brazen Careerist, among others. Follow her on Twitter at @entrylevelrebel.