Latest / The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators
How Earnouts Protect Sellers From Buyer Risk
Lucas and Luna explore how earnout structures, specifically the $2.3 billion Microsoft-Activision deal, can actually protect sellers from buyer risk when structured correctly. They examine the difference between performance-based earnouts and strategic value earnouts, discussing why some acquisitions fail while others succeed due to these payment mechanisms. The episode breaks down the specific clauses that align incentives between founders and acquirers, offering operators a clear view of what to negotiate in high-stakes M&A deals.
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The skinny
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