Should founders take early acquisition offers or hold out for a much larger outcome?

Nico Wittenborn · May 22, 2023

Founder ambition is not set from the beginning, so it is worth backing founders with modest initial goals when a strong macro tailwind will pull them to reconsider selling early.

If the 'adjacent possible' macro driver is real and pushing the company forward, founders in that rush reconsider whether to sell at $10M or keep going.

Scope: conditional on being right about the macro driver

38:28 20VC: Why Your Fund Model Should Not Rely on $10BN+ Outcomes, Why the Large Funds Got Too Large, The Rise of Solo GP's; The Pros and Cons & Is Consumer Subscription Even a Good Sector to Invest in with Nico Wittenborn @ Adjacent

Mark Suster · May 1, 2024

Ring's sale to Amazon was a missed opportunity — the company could have been worth far more had it stayed independent

Amazon now sells billions of dollars worth of Rings, which shows the scale the standalone company could have reached

Scope: concedes selling was right for the founder; concedes it may have been right for the market

49:55 20VC: Mark Suster on The Biggest Fundraising Lessons for VCs, Why the Correction in Venture is Still to Come, Why Private Equity Will Replace IPOs and M&A as the Exit Path & The Woke Left and a Trump Administration; What Happens?

Kevin Hartz · Jul 22, 2024 · hedged

Markets expand so far beyond original expectations that founders are often better off staying independent and continuing to compound rather than selling

The internet space expanded beyond anyone's wildest notions; remittance grew dramatically after Xoom went public in 2013 and PayPal acquired it in 2015

Scope: stated as a 'maybe'

28:54 20VC: How I Lost Airbnb at Seed Because of an Exploding Term Sheet | Investing Lessons from Roelof Botha & Peter Thiel | Why VC is Less Collaborative Than Ever and Great Companies Are Being Destroyed by Too Much Cash with Kevin Hartz @ A*

Markus Villig · Nov 13, 2024

Selling Bolt to Daimler for ~€100M would have been the wrong decision because the business was onto something special and worth far more built out

He was immediately clear the company was on to something special and would become an amazing business, so the risk of continuing was worth taking

Scope: decision made within a day, with co-founders deferring to him

46:07 20VC: Bolt; The Most Insane Story in Startups | Turning a $5K Loan into an $8BN Company | Why Every VC Turned Down One of Europe's Biggest Winners | Competing with Uber & The Future of Micromobility and Self-Driving

Josh Browder · May 18, 2026

Founders systematically underestimate how big their companies can get — he nearly accepted a $1M acquisition offer for Do Not Pay as a teenager and the advisors who laughed at it were right

At the time he was upset they wouldn't validate the offer, but in retrospect 'you can do better than this' was good advice

Scope: retrospective judgment on his own case

29:59 20VC: Turning Peter Thiel's $100K into $10M Angel Portfolio | The One Man Accelerator at The Four Seasons | Why VCs Can Be Sharks and What Founders Need to Know | Why Stocks and Cash are BS and You Should Invest in Land with Josh Browder

Harry Stebbings · May 27, 2024

Salesloft's sale was a great exit in hindsight

Gong raised at $7B and now trades far below that on secondary markets, so Salesloft's cash exit looks strong by comparison

25:37 20VC: Why Seed is Systemically Broken | Why Pricing is Worse Than Ever and There is More Funding Than Ever | Benchmarks for Churn, Retention and Growth Rates - Good vs Great | Why Last Vintage for Private Equity Will Suck with Jason Lemkin

Mamoon Hamid · Oct 21, 2024

The right time to sell a company is at its 'local maximum' — when markets are riding high, the market perceives the company as the leader, but there are real questions about whether it can win as a standalone versus being worth more to a strategic acquirer

That is the point of maximum perceived value by the market, so the job is to identify when that local maximum has arrived

Scope: such windows happen much less often now

26:01 20VC: Kleiner Perkins' Mamoon Hamid on Investing Lessons from Leading Rounds in Figma, Slack and Rippling | Lessons Building a Generational Defining Firm with Kleiner Perkins | AI: Where Value Accrues, Startups vs Incumbents & Scaling Laws

Jerry Murdock · Aug 22, 2026

Large exits like Cursor's $60B outcome are situation-specific events rather than the norm, occurring when boards and management conclude the company may not be a decade-long business and should take the win

The team pivoted out of the IDE space and convinced a desperate Elon that they could build models even though they hadn't proved it; such fits are not the norm

39:30 20VC: The AI Bubble Will Burst: Half the Neoclouds Will Die | China: Should We Ban Chip Exports & Be Fearful of Chinese Open-Source | Mag7: Who Dies and Who Thrives: Why Meta is Meh and Microsoft is Mega

Jerry Murdock · Aug 22, 2026

Flipboard's board made a mistake in turning down near-billion-dollar acquisition offers from Twitter and ByteDance on advice not to sell

They followed 'the coach's' advice to stay independent and the company subsequently became irrelevant

40:24 20VC: The AI Bubble Will Burst: Half the Neoclouds Will Die | China: Should We Ban Chip Exports & Be Fearful of Chinese Open-Source | Mag7: Who Dies and Who Thrives: Why Meta is Meh and Microsoft is Mega

Jason Citron · Nov 25, 2024

Staying independent rather than selling to Microsoft was the right call because controlling their own destiny and seizing the opportunity in front of them mattered more than the joint capabilities an acquisition would have unlocked.

There were real things they could have done with Microsoft that they can't do alone, but the opportunity ahead and control of their own destiny outweighed it.

Scope: acknowledges Microsoft has been a fantastic partner; acknowledges some things are only possible together

28:21 20VC: Discord's Jason Citron on Why Everything We are Taught About Hiring & Management is BS | Do Richer Founders & Gamer Founders Make Better Founders? | Never Before Told Moments Behind Scaling to 200M Users

Fabien Pinckaers · Feb 12, 2025

Odoo will never sell to a strategic acquirer

It is much better to transform companies, change the world and disrupt SAP than to have money and go to the beach

53:00 20VC: The $5BN Company Built from the Belgian Countryside | The Story of Odoo: The Company with No Plans to Sell, IPO & Their Billionaire Founder Who Does Not Care About Money with Fabien Pinckaers, Founder & CEO @ Odoo

Edwin Chen · Jul 21, 2025

Surge is not for sale at any price — he would not sell for $30 billion or even $100 billion

The company is profitable, he has complete control of its destiny and all the resources needed to do anything he wants, which almost no other company can say

Scope: allows that other people do have a price

36:28 20VC: Scaling to $1BN+ in Revenue with No Funding: Surge AI | The Most Insane Scaling Story in Tech |

Brendan Foody · Jun 1, 2026

Mercor should stay independent rather than sell, even at $30 billion, because its probability of executing on the vision is higher as an independent company

Personal wealth from an acquisition isn't what motivates him; he wants to solve how humans fit into the economy and build a legendary company creating a new category of work, which is less likely under an acquirer

12:45 20VC: Mercor CEO on Why Application Layer Companies Have No Defensibility, The Model is the Product | Token Spend Will Exceed Headcount Spend in 5 Years | The True Cost of Hiring AI Researchers in the Valley Today with Brendan Foody

Mike Salguero · Apr 5, 2023

He would not sell ButcherBox for a billion dollars in cash today

57:36 20VC: The Memo: Scaling to $600M Revenues with No Venture Funding, The Most In Detail Breakdown of Consumer Subscription Unit Economics & Why D2C and Consumer Subscription is Not a VC Backable Model with Mike Salguero, Founder @ ButcherBox

Mike Salguero · Apr 5, 2023

Selling ButcherBox now would be a mistake, even at a very large price, because the company is only just beginning to deliver on the mission he cares about

Banking the money would leave him erasing the whiteboard asking what's next, when this business has grown him and gives him the ability to impact a totally broken meat industry right as it starts delivering

Scope: no actual offer letter on his desk; at a billion dollars he would think long and hard

57:44 20VC: The Memo: Scaling to $600M Revenues with No Venture Funding, The Most In Detail Breakdown of Consumer Subscription Unit Economics & Why D2C and Consumer Subscription is Not a VC Backable Model with Mike Salguero, Founder @ ButcherBox

Zach Perret · Oct 16, 2024 · hedged

When founders agonize over selling their company, the decisive question is whether they are undershooting the long-term opportunity and mission by becoming part of another company, not the acquisition's dollar value; selling Plaid to Visa was a very close call and the hardest decision the speaker has made.

Going multi-product forces you to rework sales resourcing, brand, and customer explanation all at once — like a snake digesting an elephant instead of eating three sheep one at a time

Scope: done alongside going international and moving up market, compounding the difficulty

4:28 20VC: Why Founder Mode is Dangerous & Could Encourage Bad Behaviour | Why Fundraising is a Waste of Time & OKRs are BS | Why Angel Investing is Bad for Founders to Do and the VC Model is on it's Last Legs with Zach Perret @ Plaid

TJ Parker · Jun 5, 2023

Selling PillPack was the right call because scaling the vision independently would have been very capital intensive and because the ambition had grown to making pharmacy a shoppable e-commerce experience — best executed inside an already-large retailer

They knew their unit economics and what it would take to build; fixing the supply chain and reshaping industry dynamics required the distribution and scale of an existing large retailer

Scope: conditional on terms coming to a place that made sense; acknowledges they could have built an independent company

46:08 20VC: The Largest Venture Backed D2C Consumer Exit; PillPack: $0-$300M Revenues in 5 Years & The Biggest Lessons Scaling the B2B Business to $300M in 2.5 Years with TJ Parker, Co-Founder @ PillPack

Mark Suster · May 1, 2024 · hedged

Selling Ring was the right call because Amazon and Google both intended to own the home security market and it was going to become too competitive

The incumbents wanted the market anyway, so competition would have been overwhelming

Scope: Mark says Jamie is 'probably not wrong' rather than fully adopting the view

50:13 20VC: Mark Suster on The Biggest Fundraising Lessons for VCs, Why the Correction in Venture is Still to Come, Why Private Equity Will Replace IPOs and M&A as the Exit Path & The Woke Left and a Trump Administration; What Happens?

Peter Rahal · Aug 8, 2025

Selling RXBAR was right because a single-brand company belongs inside a broader portfolio, and big food companies are unmatched at mega scale — the founder's job is to build brand, product and supply chain and then hand it off

Financial freedom was one big factor; beyond that, the capability RXBAR needed next was scale, which the acquirer had and he didn't

37:00 20VC: The $BN Greenoaks Backed Protein Bar | Hitting $100M Revenues in David's First Year: Lessons & Mistakes | $0 to $600M: The Untold RXBAR Story | Product-Market-Fit, Pricing, Branding: What Every Founder Gets Wrong Today with Peter Rahal

TJ Parker · Jun 5, 2023

He has no regrets about selling PillPack to Amazon rather than building it independently into a much larger company

The original ambition was simply to make pharmacy better and to build a shoppable pharmacy experience, and they did that inside Amazon; he is proud of the legacy and happy with the economics

Scope: concedes the independent $20-30B outcome might have been possible

52:17 20VC: The Largest Venture Backed D2C Consumer Exit; PillPack: $0-$300M Revenues in 5 Years & The Biggest Lessons Scaling the B2B Business to $300M in 2.5 Years with TJ Parker, Co-Founder @ PillPack

Stephane Kurgan · Jul 28, 2023

Selling King to Activision at roughly five to six times EBITDA was the right decision at the time despite leaving huge value on the table

Institutional investors had been in the company over ten years and needed liquidity, which was unachievable via the public market since King traded below IPO price and the largest holder owned about 40% of the shares and could not sell down without crushing the price

Scope: acknowledges a huge value arbitrage — the effective multiple inside Activision today is perhaps 15-18x EBITDA

33:21 20VC: Four Criteria to Assess Great Founders, Why and How the Best Leaders Make the Wrong Decisions 40% of the Time, Lessons Scaling King from 100 Employees to 2,400 and Making $1BN of EBITDA with Stephane Kurgan, Venture Partner @ Index Ventures

Jack Zhang · May 27, 2025 · hedged

Selling early to a larger platform can be rational because the earlier you start compounding, the faster you can build a trillion-dollar business

This was Moritz's argument when he invited Jack to his home to convince him to sell; Jack found it made a lot of sense but did not act on it

79:55 Selling early to a platform accelerates compounding toward a larger outcome

Steve Jurvetson · Aug 3, 2020

Founders rationally stop taking 10x-or-zero coin-flip bets once their company is worth around a billion dollars, while at a portfolio level most venture firms would say keep flipping — and this divergence is the underlying tension behind early M&A offers

Given percentage ownership across a portfolio, another flip is a good financial bet for the fund, but a founder with all their wealth in the company does not need 10 billion enough to risk losing one

8:24 Founder risk aversion after reaching a billion explains early acquisition offers despite fund level incentive to keep swinging

Adam Foroughi · Apr 27, 2026

Founders who have already secured a financial baseline can evaluate acquisition offers rationally and play the long game, whereas those who haven't are tempted to cash out.

Because he had earned 'singles' from earlier businesses, the hundreds-of-millions all-cash offer in 2015 wasn't enticing and he could reason about the business's trajectory instead of the payout.

6:01 Prior financial security lets founders hold out

Ilir Sela · Aug 4, 2023

Turning down an acquisition offer and re-approaching your existing company as if it were the new company you'd start post-sale is better than selling

If he sold he would just launch a very similar business and work five more years for a similar outcome; instead he could scale beyond anything he'd done before and learn more by restarting inside the company he already had

9:19 Reapproach the existing company as if it were a fresh post sale startup beats selling

Adam Fisher · Jan 22, 2024

In a down market companies should preempt further decline and accept an ostensibly low acquisition offer now, because the offer will only get worse from here.

In a down market you always want the previous deal; if you wait you'll wish you'd taken today's offer and it won't be available. You're sliding down a mountain and time is not on your side.

54:58 In a down market take the acquisition offer now since it will only get worse

David Frankel · Oct 14, 2024

Founders should not sell too soon when their company has a real moat and is hard to compete with — the journey is long and continues even after IPO.

78:56 Genuine moat and difficulty to compete justifies holding out rather than selling