The People You Lose in M&A: Key Talent Retention Before Close

20:17Haseeb Jawad:So I should slap AI label on my company and trade hire. I have seen many such companies with just AI washing and have very high valuation expectations. Is that changing? Because I feel like it's so easy to build a wrapper around any LLM and say, hey, we're an AI company. Is that changing? Because I'm wondering, is there some metrics underpinning it that still justify it? It's like one thing to say you're an AI company, but on the venture side, they expect some extremely high year-over-year growth if you're a performing AI company. Yeah. The most important thing that's happening is there are so many AI opportunities that exist.

20:51And everyone wants to tell that story that we have acquired an AI company or we have built this AI technology within the organization. Some, of course, get a very positive reaction. Some don't. Some don't. But there have been many such cases where I've seen like it's an AI wrapper or it's an AI washing that has happened with the team. and they have pivoted. They have totally pivoted from what they were doing before to now building on the AI side. And then again, as a result, have expectations that are very high. But like you mentioned, there are still a limited set of buyers and there are so many AI companies.

21:21I have also been in conversations where the expectation was very high six months earlier, but they are probably reaching out again to think differently. Their valuation expectations have come down or maybe they have actually pivoted further. They have maybe expanded on their product vision. So there have been many such cases where organizations are trying to find their place and have a story that they can tell in a combined organization.

21:45Haseeb Jawad:Culture. Culture is one I think we want to unpack because I know you mentioned this is a big thing for you and it's been a big part of what makes or breaks deals. And I want to start with my, and this isn't a philosophy, observation that I've done a bunch of these interviews. And I would say I'm convinced there's like three big schools of culture thinking. Classic old school corporate development, which is there are two unique cultures. We're going to put the businesses together and they're going to create their own unique culture. That's it. We're going to get the deal done regardless. The numbers make sense.

22:17Haseeb Jawad:Classic. Progressive is we really want to understand culture, but we can tailor our integration approach. We understand that even within an organization, different functions have different cultures within the company. and we want to really have that understanding so we can tailor our integration approach. Then there's even, this goes beyond progressive, this is proactive, which is we have this culture that we believe in so much that any company we buy, we're going to have them conform to our culture. We're going to communicate that ahead of time. One of our biggest strengths is the way our culture operates and this is going to be a big part of you joining our organization.

22:53Haseeb Jawad:We're going to deploy a lot of change management leadership to help your organization become part of how our company operates culturally. I'm sort of convinced there's those three schools of thought when it comes to culture. I want to hear from you. What's your experience and view? I believe culture is a word that everyone is trying to understand how to actually define. We have struggled as well, and we still do. The thing is, culture is not about service. It's not about how HR policies work. It's more about how decisions are made. and especially under pressure. And what we have tried to do is...

23:30So corporate development at Commvault is actually part of an organization that's called Corporate Trust. We basically have corporate development, business development, security, legal compliance, like all those things. So our organization is basically called Trust. So Trust is very important to me. And I actually came up with an acronym for Trust. It starts with transparency that you need to be very transparent from your first conversation when you're talking to the founder, what your intentions are, what you want to do, what the strategic story you would tell. And when you're communicating to the rest of the employees throughout this journey, how you're building that transparency, what's the honesty, what's the honest story that you're telling everyone involved.

24:07R for relationships, the relationship that you're building throughout this journey. Again, sometimes it starts with founders because those are the folks that you are actually involved with right from the beginning. But over the period of time, while you are doing diligence, there are more people who are involved and get into those conversations. So how you build those relationships throughout the journey and even after closing the acquisition. You for unified leadership. And this is very important to make sure that your entire leadership within your organization is aligned. And also the company that you are targeting at or looking at is also aligned with this story.

24:39We actually start with our M &A committee. We have a committee where we have a CFO, a CEO and others in the organization. And we discuss how we are going to do this acquisition, but then expanding further with the rest of the leadership team and actually having those conversations and making sure that everyone is aligned on one page. Next, I would say is as for the signals, seeing early signals in every signal is important. How you're going through diligence, what's the reaction to various conversations you're having when you are going through your diligence or integration conversations, what's the story that the other person is telling you and catch each and every observation, each and every word that other people are telling you.

25:18And then the last thing I'll say is the talent, how important the talent is for these acquisitions. I cannot emphasize that enough because I did mention previously about the technology, the financial story and the culture story. The culture story aligns with the talent that you're going to be bringing. Being a strategic company, the engineers, the product team, the rest of the organization that we are bringing is going to be very important and how you align with the rest of the team

25:41Haseeb Jawad:is going to be critical. So that's how I see it. The culture piece, how you're building, starting from the transparency, the relationship, the leadership and unified leadership, the signals that you're catching through the conversations, and then looking at the talent, not as someone being acquired, but as humans, and be empathetic to the situation that they are going to be going through. And if you're looking at like from all various angles, then you'll be able to put yourself in their shoes and make decisions that are not just process-based or tools-based, but actually human-based. You flip this culture thing around to your approach on deals.

26:15So I like it.

26:17Haseeb Jawad:Can you tell me a story? Tell me about a deal that culture integration maybe broke down or some lessons learned. I remember one story many years ago, which I was talking about the unified leadership, that there wasn't an alignment on both sides. It was very much like a merger of equals. And I don't think that there was an alignment on the story, the strategic rationale among both leadership teams. And when we still did an acquisition and we started working on integration, there was of course politics involved, there was fighting going on and not just at the top level, but actually at the middle management level as well.

26:50When you are going through integration conversations, you can actually see the friction that's happening. You can see people actually getting protective about the processes, about the work that they are doing. And that friction continues to get worse and worse over a period of time. When there is lack of alignment, and especially from the top, they're not actually going to share the same story with the rest of the organizations. And you'll continue to see those friction points, continue to see the things that are breaking. And once the human connection breaks, then everything just follows, whether that's from the process perspective or a tools integration perspective and others.

27:23And my lesson from that was, I could actually see that from very first conversation when we were talking about the integration governance, how the integration management office would run. And there was a misalignment there. There was friction there as well. We could actually see it from the beginning that this is not working as well. So my lesson was, if there's no unified message, unified leadership, human connections are going to break throughout the organization.

27:45Haseeb Jawad:Unified message and leadership. and that way you have this communication that creates clarity in terms of what the expectations are. Can you give me the playbook? Teach me how to not screw this up when I go do a deal. From a cultural perspective? Yeah, like pointing a name for it. Yeah. Hasib's culture first M &A approach. Yeah, teach me this part. Here's a good example of what went wrong. And then you're giving me this description of what could have been done better, which is make sure there's unified leadership, which I feel like is you have two sides coming together. Am I interpreting it right?

28:16Haseeb Jawad:Like what's this combined leadership and how they're going to work and what their message is? I feel like there is a point of friction where there's almost an assumption as an acquirer, they're going to conform to your culture. And then there's vice versa where the people, the inertia, they kind of expect to keep things the same and not have to make these big changes. And then that ends up hitting those points of friction, unless you got a different view of what causes that. But I just want to understand, like if you're going to turn this into a playbook of what's the right way to do it, make sure you don't have those challenges coming down later.

28:43The example that I wanted to give was, I've heard sometimes these comments from various teams that it's very much like a new hire. The new hire is actually going to follow your IT policy, your HR policy, your email retention policies and things like those. So how is that different that you're bringing 20 people in an organization and you're saying that, yeah, we need to treat this very differently, very sensitively. How are they different from other new hires? And the difference is new hires have actually decided to join that company. they have actually learned about us as an organization versus an acquired company who probably got to know about this acquisition through a press release just a few hours ago.

29:21And they don't know much about you and they don't know about the story and the strategic rationale and how you're actually going to combine the company. So sensitivity and putting yourself

29:30Haseeb Jawad:in those shoes is going to be very important. And what I've actually seen is I have an example where there was an email retention policy. And we have a certain policy that over these many years, all the emails before that are going to be deleted. And I had this very particular conversation with IT where I said, let's give some more time, some more heads up to these teams so that they understand why we are doing this and they have enough heads up to actually think through this. And again, the same new hire versus an acquired person story comes in that you just need to be slightly more sensitive and put yourself in those shoes that they need time to get stabilized, to get an understanding of how all of these policies work.

30:09So with that, my way of actually thinking about the retention of the culture is right from the beginning when we have had the first conversation with the founder. Are we connecting with the founders? Are we connecting with the story that we are telling? Can I imagine myself being a colleague of that person and vice versa? Can they see me and the people who are involved in these acquisition discussions? So it starts from the founder conversation and how well you are aligned with them. The second thing I would say is how founders are actually telling the story about their employees. not just about their products, not about their financials, but about their employees and how the talent has actually built that organization.

30:46So that's giving me signals about how they operate, about how they think about the organization. And the third thing that I do in my diligence is also, of course, look at the common connections. And if I could find out from maybe ex-employees or maybe Glassdoor comments or reviews, anything that is publicly available, or I can do some research to actually find out about the people who are involved in this. So all of these three things that I've just mentioned is my diligence in understanding how employees think, what is important to them, and what we can do as a combined organization.

31:19Haseeb Jawad:The typical retention plan gets built after close. Financial package, equity, maybe a one-year bonus. And then in month 13, the person you built the deal around walks out the door. The operators who get this right start thinking about retention before LOI. And that's exactly what Buyer-Led M &A is built for. It's the first standardized framework for buy-side execution built from 400 practitioner interviews and structured into a certification you can finish in 10 to 12 hours. If you're serious about getting this right before your next deal closes, go to mascience.com and look for the Buyer-Led M &A certification.

31:59Haseeb Jawad:We'll put a link in the show notes. When you do that, like this sort of your diligence, I like the way you had, you know, the common connections. What was the first part? The founders and how we actually connect with the founders. And then how they talk about their employees. How they talk about their employees. And then, of course, the publicly available information about the employees and the common connections. Yeah. Okay. So that's, all three of them are part of the diligence. First tier. Yeah. That's you can do pretty quickly. The second thing I would say is after doing the initial diligence, actually having employee by employee level conversation with the people involved in diligence.

32:32Haseeb Jawad:This is after LOI? This is after LOI. Not think of employees as an Excel line item, because I think many cop dev folks think of it that way or thinking of this as the synergy opportunities that you can find. But going through person by person, knowing what they're doing, learning about it. And if you are walking into the organization, if you can imagine yourself that this is all the employees, do you know enough about the function that they are performing, the role that they are doing for the broader organization? So doing that kind of diligence at an employee by employee level, you may say that it's very difficult for larger organizations.

33:09It is very difficult if it's a really long list. If you are doing a tuck-in, then of course, going through 20 employees, 30 employees is easy. But for the larger organization, the plan that I followed is at a functional level, if we can do that diligence, maybe it's not an employee level diligence, but at a functional level diligence, if we can perform that.

33:27Haseeb Jawad:That's another thing that we do. And then, of course, as we are going through it, understanding what is important to them, what's going to be the retention that's important. I actually joined a conference. I'm going to steal some information from there where they said pocket is not the most important thing, how you actually provide them with retention bonuses and everything. It's the heart, brain, and then pocket. In that order. How you will win hearts of the acquired employees. How you are going to tell the story that convinces them to think about the combined organization. And then, of course, what are the financial incentives that you're going to be providing.

34:03So yeah, doing diligence with founders, with the publicly available information at an employee level, and then building your retention plans, whether that is from a story, winning their hearts, or from a cash perspective or from a retention financial perspective. Those are all the important things that we need to do.

34:23Haseeb Jawad:I want to clarify how early the buyer led model is to really put as much of this consideration in early that's going to help you drive success later in the deal. What does that look like in the early stages? Even like getting the LOI, how much clarity do you have around thinking through culture and like what's the... factors that are going to make the deal successful? I'll go back to the same thing, which is culture is a very difficult word. That's not easy to be defined. You get different level of information at different points in time. Before LOI is, of course, at a very high level, at a founder level.

34:55After LOI, you are doing more diligence. You're looking at employee by employee level. Then you're getting some signals. You're getting some signs that are helpful. And then you actually announce and sign the deal. And you go through day one events. and then of course, post-closing all the integration activities. So the information that you get at different levels, different points is going to be very different, but it needs to be built on a strong foundation. It needs to be built on what's the talent going to be doing post-integration. And it also starts from what your plan is for that team and sharing that plan right from the beginning.

35:27Some acquisitions may have a plan where you are maybe looking more from a customer acquisition angle or a financial angle. Some may have where there is actually a gap in the technology and talent is going to be very important. there will be places where there is a consolidation and there is actually synergy opportunities that you would be exploring. So tell your story first before you engage with the employee so that there is a level of transparency, level of trust that you have built and not leave it to people guessing what the intentions are for the combined team.

35:57Haseeb Jawad:Get ahead of it. Retention, can you walk me through what your retention framework looks like? So heart, mind, and financial. So I think heart is through your action. Everything that you are doing is going to be judged, is going to be looked very closely. And whether that is a day one event, who is attending the day one event, what are we talking about? What's the all hands conversation going to be? How transparent are we? What are the intentions? Are they honest and transparent intentions that are coming in front of the people? So every action, every word that you choose is going to actually help you win those hearts.

36:34Second, with the mind is the better together story and how convincingly you are telling that story. And not just for the deal thesis that you build that, but it's actually that you believe in it. In convincing people about that story so that they can be partner with you in that journey. And then the third thing from a financial perspective, that's about sometimes you actually have to do some salary rationalization. So you need to understand where they are from a salary perspective versus where you are in your organization. So what's the rationalization that you need to do? Is there changes in salaries that need to be made?

37:09Or what are the bonuses that we are providing? What is the retention package going to look like? Is there a cash retention or an equity retention? And what are the earn outs that you have built for your founders? So all of those things are important, but they are interconnected as well. I have had this conversation with someone in HR team. We had a retention plan for the team, But there was actually, not by anyone's mistake, but coincidentally, there was actually a delay in making those retention payments. And there was actually a delay in communicating that. We actually did that for the goodwill, for people to be connected.

37:46But just by how payroll was being processed for some of those employees created an optics, created an impression that is not necessarily positive. So while you had maybe one heart of those people, the financial package that you have given just by certain actions or certain delays that can make an impression in someone's heart that what the intention is from the team. They are very much interconnected. And each and every action, especially in the beginning, is being judged from by the acquired employees. I've been in both shoes. I've acquired companies. I've actually been acquired. And when I was being acquired, I had the same set of impressions about the other organizations.

38:25So you need to be very critical and on top of things that you are providing to employees.

38:30Haseeb Jawad:If you totally screw all this up, what's your worst case scenario? I think your deal thesis is falling apart. Being in a strategic technology company. Bunch of key people quitting. Yeah, a bunch of key people quitting. There's an attrition risk. And you're all solving those problems rather than the product roadmap that you wanted to solve. It's interesting that when we talk about retention models, most of these conversations always is around some kind of financial retention plan. What are incentive plans, basically? Which you got to, but you got to all these other things of like, your actions kind of tell you the heart thing and then the brain in terms of what the story is like.

39:06Haseeb Jawad:You sort of led with those things. Do you really feel like that's the key thing? It's not more of like, how much money am I getting? I think it's all. They kind of play into each other. Like I said, most of the time it's purely, what are we offering as a financial incentive? I'm looking at a deal right now. And that's, I know there's going to be two key people on this deal. And that's like, right away I'm thinking about to get the deal model to work. You know, what kind of financial incentives do we have to lock them in and make sure they're going to stay through integration. And I'm not really thinking about the rest.

39:35Haseeb Jawad:Am I screwing that up already? I should be like nailing the story down and why we're going to come together. We're going to better serve the customers. We're going to be a stronger company together. Is that like what I should be emphasizing? I think I put myself in those shoes. Like when I have decided to join various teams, how did I think about it as a new hire? I've always chosen teams or people that I'm going to be working with. I've chosen the company and the reputation that the company has. And of course, the financial package that I'm going to be getting. But it hasn't been just one criteria.

40:07So if when there was actually a choice for me to join a team and I was looking at comprehensively from all those angles, think of those acquired employees. They didn't decide to do that. But the same criteria will be important to them. We cannot over pivot on one thing and say, yeah, financial incentive is not going to be important because I've won the hearts and the minds of the people. Or vice versa, that I'm giving so much financial incentive that the persons or the people are going to be happy about. And it's not important to tell them the story or it's not important to win their hearts. You cannot over pivot on one.

40:37There is a balance that you need to find and the right balance. Sometimes, again, you have to put more emphasis on one thing over the other. because if you just put an emphasis on financial incentive and let's say there's a retention packet for a year, you can guarantee that the person you have given that financial incentive, that person will leave after that one-year retention bonus, for example. The purpose of doing all of that was to actually look at long-term vision, the long-term retention. So you wouldn't want to be in a situation where you give a one-year retention package and that that person leaves on month 13th.

41:08So how you balance all those three things, in my opinion, is very important.

41:12Haseeb Jawad:How early do you start thinking about retention? And I want to understand, how do you actually structure it? How do you know this person is going to be more incentivized by equity versus cash or whatnot? It's through the set of interviews with various people. Again, it's a very direct conversation with founders. And that's, of course, the very important one to begin with. Getting their plan, what will get them excited about this deal from a financial perspective or from a story perspective or from a heart's perspective. but then interviewing those founders about their employees. If the other people in the organization are involved in their diligence, then asking them about their employees as well and getting that direct feedback.

41:51What gets them excited? I actually have a set of interview questions that I actually go through when we are doing the employee by employee analysis. And some set of questions are basically, what gets this person excited? What's the challenging thing that this person is actually going through? What have they asked in their last performance review? So getting all those signals give you a full color, but then also be flexible at times. You may have actually started in your diligence and creating retention plans. But later on, when you actually close the deal, you found out that there were other things that you were not considering because maybe they didn't come across in those interviews on those diligence conversations.

42:28So be flexible and learn from your early challenges and adopt to it. It's easy to do it during diligence because you are still building a business case. you're still actually selling that story. And sometimes post-acquisition, it becomes difficult because then you get stuck in the processes and the policies and things like those. So finding exceptions, putting yourself in those shoes and be empathetic in those situations is very important. So agility, flexibility, post-acquisition is very critical.

42:56Haseeb Jawad:You got to have a good view coming in and you got to be agile going out after those. You served as a central IMO across integration. Can we talk through that? What did you learn? What does that function actually own? How do you keep integration? Like the cliche thing, it's like the black hole. The deal team does the deal, flips it integration, moves on. And I'm just curious of like, what do you learn? What's the best model? The thing that I've always liked in all my experiences in M &A, in all three companies, is I've been involved on both sides, the acquisition as well as the integration. So it's the same team, the same person who is involved in leading those.

43:33and the wonderful thing about that is that when you are building the business case as a deal person and let's say you are building assumptions that there will be these many synergies on it side that you are going to discontinue this tool or you're going to find these headcount or non-headcount synergies you are going to be responsible to actually implement those if you don't feel confident in getting that done in post-merger integration phase then that excel math is not going to work. So the appreciation that I get when I'm involved in diligence as a deal person, whether that is building a business case or whether that is telling the story to the board, is how it will have an operational impact later on when I'm leading the IMO organization.

44:19So every decision, every assumption, every Excel formula that we are making on a business case needs to have an operational plan behind it. Sometimes it's detail, sometimes it's very high level that, yeah, this is how we will do it. Or at least have a conversation that this is what will make it practically possible. It's not to say that we have always succeeded. We have failed many times that there was an assumption and we thought that, yeah, this is going to be the operational impact. And this is how we will actually do all these five or 10 things. There have been cases when they don't succeed, but at least have a foundation that you can tweak later on.

44:55So there's a benefit. And especially in my career, there has been that benefit where I was responsible for both the acquisition as well as the integration side. Now, what it means for me as an integration management office leader is how you are bringing the rest of the organization along, how you are telling the story to the rest of the teams who were not involved in diligence, how you're communicating that, how you're talking about the North Star that was important for the deal to be successful. And then keep on telling that story, keep on communicating, keep on managing and coordinating across various teams and provide them with the guidance, provide them with the decision-making that's important.

45:37And sometimes it's fast decision-making. So the IMO, in my opinion, is the managing, the coordination, the communication, the deal thesis story, and making sure that you are providing the feedback and helping with the decision-making that's very important to various teams. you are sitting right in the middle of those conversations where you are hearing from finance or IT or product or engineering teams that those teams may not be actually hearing from the rest of the folks. So you are the common connection that can connect those dots and help those teams think through the implications of the decision that they are making to the rest of the integration story.

46:18Haseeb Jawad:It's like a lot of engineering thinking to unpack there, that you have the assumption that you think through what the operational impact is and that there's some kind of operational plan behind all these assumptions. And then you really think through what this looks like end to end. I like to be detailed. I like to have a, like I said, plan behind every assumption that we're making. I like to feel confident with those. But again, this is not to say that you can have answers to all thousand different pieces of the puzzle that you are trying to tie together. But if you have a strong foundation, then you can build on top of it.

46:53And then you'll have an ability to be flexible when things require some changes.

46:59Haseeb Jawad:That's a good one. We should expand on that, put it into a company science framework here, the buyer-led framework. I feel like there's an assumption that we always talk about validating those assumptions. I think you got that engineering lens of like, okay, let's really define it so we can clearly validate it, but even more so operationalize it so that you will be able to achieve it. Yeah. You actually asked me this question in the beginning. Like you were just saying, the engineering mindset, the analytical mindset, the project management mindset, having visibility to how the product organization works, having worked in the financial domain, and of course, the MBA experience, all of those things, just having the appreciation of how different pieces of this puzzle work is very important.

47:42Haseeb Jawad:How about when you have to pull people in just to get their take? There's like some of this thinking, but then there's also like, It goes back to that relationship across the organization. You're probably pulling in people as needed to get more of their perspective and validate some of these assumptions. I sometimes say that relationships open door and not the processes or the policies. Because you need to phone a friend in different functions to get a perspective. You need to brainstorm. I always approach conversations by saying, hey, I don't think I have an answer, but I want to be creative and I want to be collaborative.

48:18So help me think this through and I'll help you think this through. And together we'll come out of this conversation with a solution that may be workable. And if not, then again, we'll be creative and collaborative in adjusting it. So relationships have always been very important in acquisitions or integration. I've always said in various rules where I say an acquisition or co-op dev in general sits in the middle where there is a neutral perspective that sometimes you bring. That's why me being in CoopDev has sometimes been involved in strategic initiatives across the organization. It's not related to an M &A project, but maybe it's a transformation project or maybe it's a corporate strategy work that we are doing.

48:57And you have got that kind of an exposure or perspective and relationships that you have built across the team. And you have a neutral perspective that you can hear a different perspective coming from product versus the sale. And you bring in both those people together and have a plan or a perspective that works for both the teams and your customers. Being in a place where you can bring different perspectives and solve those together is a remarkable place to be in.

49:22Haseeb Jawad:You'd be a great industry spokesman for all the corporate people in the country. One of the things we didn't talk about, but I want to hit on briefly is these investments for the minority investments that you make in startups. Because you do that, but you don't have like a dedicated venture arm or fund. You essentially do it. You mentioned briefly about partner, invest, M &A. Tell me about where that fits in. Is it to facilitate, getting a foot in the door? How do you think through making those kind of bets? Is access to technology? What's the driver of doing those kind of minority investments without a formal strategy?

49:53The answer is all of the above. It sometimes is foot in the door. It sometimes is what I just mentioned about the creative and the collaborative way of working through the relationship. The other company, the other team may not be in a place where they're looking from an acquisition perspective. And an investment with that company can put both of the teams in a place where you can test the thesis first. You can work together, learn more about each other in a different kind of relationship, which is an investment and a partnership kind of a relationship. And then over a period of time, you learn from it and you maybe go through still an acquisition, but you'll have a different and more comprehensive perspective in the better together story.

50:35So sometimes, yes, it has been a foot in the door and leading to an acquisition in the future. Other times, it has also been maybe acquiring a company just doesn't make sense for both. And that has been the case right from the beginning. You don't have an intention to do an acquisition in the future, but there is a co-build, co-market, co-launch opportunities that you can explore and then do an investment. Third thing I would say is there have been some investments where we want to know more about the industry and the market. We want to look at the high-performing startups and be part of their journey, whether acquisition in the future is in plan or not, whether that is going to lead into any co-build or co-market or co-launch opportunities.

51:15But just knowing that team, knowing that space, knowing that market is going to be helpful for both the organizations. That's important. But like you said, we haven't been a formal venture arm. It's more like opportunistic and thinking through those conversations. And like I said, my first LinkedIn reach out sometimes is, let's explore.

51:34Haseeb Jawad:Let's look at what the strategic story could be. And it is true because we have maybe in mind an M &A story. But when we talk together, we decided that, yeah, investment makes more sense. So it was an honest and transparent reach out when we say, let's explore. Yep. I like that. I like that. Keep your options open and use it as needed. Can I hit you with a few rapid fire questions just to get your take on it? But acquirers always say they want to preserve the culture they bought. When is that actually right? And when is it just something you say to close the deal? I learned from one of my colleagues.

52:07She always used to say, what's the secret sauce of the company that you are looking at? Knowing that intelligence is very important, but maintaining that is even more important. So while again, going back to the same thing, culture is a word that's not very well defined. sometimes it's maintaining that secret sauce, it's maintaining that culture that's going to make both the organizations successful. So while it's a cliche sometimes that, yeah, you maybe are using all those fancy words to convince the other side, but the deal value is lost if you're not careful and if you're not deliberate about it.

52:42Maintaining the secret sauce, maintaining the culture what made them successful is critical. This is not to say that when an organization has been acquired or has been absorbed by a larger organization, that they are not things that will change. But what made them successful needs to be retained.

52:59Haseeb Jawad:Trying to break stuff. Yeah. And diligence, what signals tell you a culture integration is going to be hard before you're ever in the room with employees? Every observation, every conversation, every words that the other person has used will give you signs. And sometimes as deal folks, we may have a tendency to ignore those because we are maybe in a deal fever that we do want to do it. It's like leaders talking bad about their employees. Yeah, yeah. Really? Those are important and cannot ignore. And I have ignored some of those. We've got a couple you could, you know. Okay. Exactly. So your gut feeling, I feel, is always right.

53:35And you shouldn't be ignoring those.

53:37Haseeb Jawad:Small team, full mandate. What breaks first when deal volume picks up? I think the depth. Yeah. What I mean by that is when you are looking at the variety of acquisitions, the depth in your observation, the depth in your diligence, the depth in your integration plan may get lost. Not necessarily in just cop def, but in your overall organization as a whole. And so I think it's the quality versus quantity. I see. What's the craziest thing you've seen in M &A? That's an interesting question. I would say walking away from the deal because it's not easy. And sometimes you are too far in the process that you feel that you have spent so much time.

54:14You have sold this story to many folks in the organization, to your board, to the founders, but you have found things that are not workable and you may be ignoring some of those. Tell me, tell me. But we are talking about the cultural signals that someone talking bad about their employees.

54:31Haseeb Jawad:But you've had it where you're like post-LOI and this culture drove you to walk away from a deal? We have, yeah, yeah. What happened? It's more about understanding what founders believe the story to be versus what an actual cultural story that exists. There was one deal where we worked with a founder who we later on found out was actually in a competition with his family because many people in his family have been billionaires and been very successful. And the reason why he was building an organization and building a team is from that competition perspective. This was more led from his incentive to be at par with those conversations with those folks than thinking about the employees.

55:22And when we dug deeper, when we learned more about the employees, when we learned more about the attention that the management has been paying to the organization, it wasn't something that was working out for us. And we decided to walk away in that situation.

55:35Haseeb Jawad:That's probably the right call. Yeah. Wow. It does happen. It's just like, this isn't the right thing that's going to fit well. saved the headache. Asif, this has been a great conversation. You've given me a new perspective on a culture-focused approach to M &A, helping me become a better M &A scientist. Thank you. Thank you for inviting me. And it was really nice talking to you about the journey that I've had. Looking forward to more such conversations. If you're still listening to this podcast, my fellow M &A scientists, I would love to hear from you. Actually, it's my favorite thing now. I get quite a few people that reach out on LinkedIn.

56:08Haseeb Jawad:Make sure you put a little comment or note so I know you actually listen to the podcast. I get tons and tons of spam on there and I'll connect with you. I love to hear any kind of feedback in terms of topics we haven't covered that you'd like to hear covered, any kind of criticism on how I can do better at being an interviewer. I'll take it. I'm trying to get better. It's always fun. We got a lot of fun stuff coming up too. So keep up with our newsletter and just follow us on LinkedIn. So next time, here's to the deal. One thing Hasib said that I keep coming back to, Every assumption you put in the business case needs an operational plan behind it.

56:43Haseeb Jawad:And the person who built the assumption should own the outcome, not hand it off. But own it through close and beyond. That's the whole model behind ByerLed M &A. Same team, same accountability, end to end from first conversation to close. The certification gives you the framework to actually run it that way. If you want the full framework, the ByerLed M &A certification is 10 to 12 hours, self-paced and built by the practitioners you've been listening to. Go to mascience.com, check it out, and put a link in the show notes.

57:28Haseeb Jawad:Thank you for taking the time to explore the world of M &A with our podcast. We love hearing feedback. Tag us on a LinkedIn post, add a review on Apple Podcasts. We'd love to hear from you. If you need help standing up an M &A function or optimizing one that you already have, we're here to help. And if we can't help you, we probably know someone that can. You can reach out to me by email, kison, K-I-S-O-N, at mascience.com. Or you can text me directly at 312-857-3711. If you just want to keep learning at your own pace, visit mascience.com for a lot more content and resources. That's where you can also subscribe to our newsletter.

58:13Haseeb Jawad:Again, that's mascience.com. Here's to the deal.

58:27Haseeb Jawad:views and opinions expressed on mna science reflect only those individuals and do not reflect the views of any company or entity mentioned or affiliated with any individual this podcast is purely educational and is not intended to serve as a basis for any investment or financial decisions