Latest / The Startup Exit Podcast with Fexingo: IPOs, Acquisitions, and Founder Liquidity Events
How Founders Use Tax-Free Rollover in M&A Deals
Episode 108 of The Startup Exit Podcast — Lucas and Luna unpack a powerful but underused exit mechanism: tax-free rollover under Section 721 of the tax code. Using the recent acquisition of a real-world AI startup as an anchor case, they explain how founders can exchange their shares for equity in the acquirer, deferring capital gains taxes indefinitely while staying aligned with the buyer. Lucas walks through a specific example: a cloud-security founder who rolled $40 million of her $65 million deal into the acquirer's stock, avoiding an immediate $8.5 million tax bill. Luna pushes back…
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