Highlights from boston.com/hive, Boston’s source for innovation news.
Some entrepreneurs are determined to remain independent and grow their companies as big as they can possibly be, no matter what kinds of buyout opportunities come along.
The rest of you might be interested in some smart advice I picked up Wednesday at the Cooley Medical Technology Growth Conference about positioning your company for a lucrative acquisition. Yes, the event centered on med tech, but these tips could apply to almost any business sector.
The first thing to do is focus on building a successful company and not get ahead of yourself, said Mike Grippo, vice president of corporate development at C.R. Bard, a publicly traded medical device company based in Murray Hill, N.J.
“I’ve often noticed that some companies start the process too early,” Grippo said during a panel discussion at the Mandarin Oriental hotel in Boston. “Some CEOs spend too much time trying to market-position the company for sale and not enough time running the businesses.”
Nevertheless, a forward-thinking business leader should always be making connections and drumming up interest in the company, said Daniel Levangie, cofounder and managing partner of the Boston private investment firm ATON Partners. Previously, he was cofounder and managing partner of Constitution Medical Investors, a Boston blood-testing company that sold for $220 million in July. A key to the successful acquisition was getting on the radar of potential buyers several years in advance.
“We began to show the product before it was a product,” Levangie said, recalling exhibitions for Constitution’s blood-testing system at industry conferences. “We had very little clinical data, but we had every tire kicker in the industry at our booth. Over time, that large group of interested individuals became three or four. By the time we had clinical data that looked very promising and a product configuration that we were pretty convinced was disruptive, we kicked off a formal [sale] process, and those same four companies engaged in the process.”
It’s also important to keep an open mind when envisioning a future acquisition, advised David Wong, a principal at Audax Private Equity of Boston. The best buyer may not be the one you expect.
“Not being dogmatic, in terms of who you think the buyer is going to be for your business, means you may open up a whole new set of buyers that create a competitive process to get a premium valuation,” he said.
More job options for software developersRight now, software developers are probably the most intensely recruited workers in Boston. But Tom Summit, a longtime tech recruiter based in Newburyport, said that despite fielding cold-calls and being spammed on LinkedIn, developers often don’t consider all their options for changing jobs.
“Engineers don’t create a market for themselves,” Summit said. “When they’re ready to make a move, they ask a friend who works at an interesting company to help them get an interview. Logic says you should get multiple offers to maximize your compensation, but many of them don’t.”
Summit’s new site, MakerHire, isn’t for every software developer. The site will select good ones and then similarly select a group of “financially viable” tech companies that are actively hiring. Hiring managers, not recruiters or HR execs, will be able to see the developers’ LinkedIn profile or résumé, and request contact. One key feature: Hiring managers must specify how much the job pays upfront, as opposed to asking developers to navigate the interview process before they find out.
MakerHire charges a placement fee when someone is hired through the site: 12 percent of the individual’s first-year salary. A traditional recruiter’s fee typically starts at about 15 percent.