This post is part of my weekly “Ask the Attorney” series which I am writing for VentureBeat (one of the most popular websites for entrepreneurs). As the VentureBeat Editor notes on the site: “Ask the Attorney is a new VentureBeat feature allowing start-up owners to get answers to their legal questions.”
I have two goals here: (i) to encourage entrepreneurs to ask law-related questions regardless of how basic they may be; and (ii) to provide helpful responses in plain English (as opposed to legalese). Please give me your feedback in the comments section. Many thanks, Scott
I remember post-“9/11” working at a major law firm in New York City and watching all of the transactions on my plate fall apart. Indeed, then (like now), as credit dried-up, the M&A pendulum swung to the acquisition of distressed (i.e., financially-troubled) companies; however, as I learned first-hand, acquiring a distressed company raises a host of significant risks and potential problems that are not typically found in the acquisition of a healthy, solvent company (which I recently discussed here). Below are ten tips for entrepreneurs who are looking to get into the distressed M&A game. They relate to two different contexts: (i) prior to (or absent) a distressed target’s Chapter 11 filing — i.e., the non-bankruptcy context; and (ii) after a distressed target’s Chapter 11 filing — i.e., the bankruptcy context. (more…)
As I have previously noted, I was a corporate attorney for nearly eight years at two major law firms in New York City; and the majority of my work there was spent negotiating and documenting large mergers and acquisitions for multinational corporations, financial institutions and private equity firms. When I moved out here to California in 2005 and started focusing on representing entrepreneurs (which meant predominately middle-market M&A transactions), I was surprised to see how unsophisticated a lot of the players are here; in short, it’s a different environment than New York. Nevertheless, I love living in California, and I am trying to provide to entrepreneurs (via these blog posts) some legal tips and lessons I learned at the big firms in New York City. Below are ten tips for entrepreneurs who are contemplating acquiring a private company. (more…)
I’ve been doing deals as a corporate attorney for over 15 years, including nearly eight years in the trenches at two major law firms in New York City; and during that period, I have seen certain mistakes made by entrepreneurs (and inexperienced deal guys) over and over again. The purpose of this post (which is part I of a series) is to discuss the following five basic mistakes made by entrepreneurs in connection with corporate transactions: (1) the failure to diligence the guys on the other side of the table; (2) the failure to build a strong transaction team; (3) the failure to run the negotiations through the lawyers; (4) the failure to check their emotions and to remain disciplined; and (5) blinking first. The video version of this post is set forth immediately below.
Below are ten legal and practical tips for entrepreneurs who are contemplating selling their venture.
1. Be Careful with Private Equity Buyers. Private equity firms are in the business of buying and selling companies. Accordingly, they are extremely sophisticated and savvy and are often represented by large, aggressive law firms. Deals with private equity buyers are generally more complex than those done with strategic buyers due to, among other things, the level(s) of debt added to the target and/or financial engineering. Moreover, unlike most strategic buyers, private equity buyers (i) usually require the selling entrepreneur to rollover part of his/her equity into the acquirer (i.e., to maintain skin in the game) and (ii) may require a financing condition in the acquisition agreement – which obviously adds a level of uncertainty to closure. (more…)
Scott Edward Walker is the founder and CEO of the Firm. Scott has 16+ years of broad corporate and securities law experience, including nearly eight years at two prominent New York City law firms. Read more »
