The perception that selling your startup is a personal failure, is unquestionably a brake on the emergence of digital champions. Technology can be seen as a race and teaming up with a better-positioned player is always a great way to skip few stages.

When you launch your start-up, it is often with great ambitions. Inspired by the journeys of a few exceptional personalities, we dream of changing the world and, even better, of doing it alone.

In the collective imagination, the entrepreneur is a sort of adventurer who triumphs over all obstacles armed with only his genius and tenacity, his success is above all seen as individual. And that is why the takeover of his company remains widely perceived as a failure, sometimes even a personal humiliation. This vision is unquestionably an impasse on the emergence of new tech innovations.

Merging is a not dead end but rather a gateway towards growth

Although venture capital has strongly developed in the recent years, it is sometimes difficult to raise funds, particularly in B2B activities, industry and deeptechs, which are less favoured by investors.

Under these conditions, it can be difficult to compete with better armed American or Chinese competitors. And even with substantial means, success requires a capital that no one can provide: time. As such technology is a speed race and teaming up is a great way to grill a few stages. Merging is therefore not a dead end but, in many cases, a pragmatic way of accelerating growth.

We can for instance take the example of French company Danone and Michel and Augustin or Société Générale and Shine, if the potential buyer is a large group, this is the opportunity to benefit from a solid foundation and contribute to a broader destiny.

To associate is to give oneself the opportunity to value technological, commercial and territorial complementarities. It means pooling resources to increase its development capabilities, and having more data to feed its algorithms. It also means increasing in size, and therefore in visibility and credibility towards major contractors. In addition, it is an influx of fresh blood for the entire organization, thus foresting diversity, creativity and skills, all being essential key elements to the sustainability of innovation. Finally, a merger allows the two entities to give birth to a sector giant, thus defining the competitive landscape while attracting investors.

Cultural compatibility, a prerequisite for the success of a merger

The aforementioned synergies remain hard to come by. Without a convergence of views and values, achieving a state of cultural synergy will prove to be very difficult. This is can be used as an explanation to the failure of some takeovers.

Indeed, the value of the startup lies not only in its product, but also in the way it operates. This is why the buyer must find a modus vivendi that leaves him the autonomy he needs to flourish, since imposing too rigid rules would risk killing the potential of the start-up.

This cultural compatibility must begin with the leaders, between whom a genuine relationship of trust must be forged. The founder of the absorbed society must be at ease with his decision, and with the role that he will occupy in the future organization. For he will be, a major ambassador of the merger.

The start-up employees may have a negative feeling about the takeover and, above all, feel dispossessed of their efforts and worry about their job or career prospects. The leader must then take the time to explain, convince and clarify the why and how of the project.

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