OK, timing was not so good on my book (How to Create the Next Facebook). It came out after the disastrous Facebook IPO!
But since then, the stock price has staged a great comeback — and yet again, Mark Zuckerberg has showed that he has the right stuff.
So what’s my book about? We’ll, it shows all the critical steps in how Facebook became a world-class company:
Creating a mission: If you want to create a lasting company, you need this. As should be no surprise, Facebook’s mission has been clear from the beginning – and it has been a guidepost for whenever there was a new challenge, product or investment.
Getting the legal stuff right: Zuck was not so good on this front. From the start, he made a variety of blunders. After all, he had major issues with investors as well as the protection of intellectual property. Zuck, unfortunately, had to learn the hard way and it did prove costly.
Building a great product: Without this, you might as well shutdown your business. In today’s hypercompetitive environment, it is extremely tough to standout. So you need to have a product that solves real problems.
Raising capital and pitching investors: Startups want to focus on growth, not revenues in the early stages. It’s a smart strategy and proved very effective for Facebook. But to make this work, you need to also have a smart financing strategy. In my book, I show how you can put together investor pitches, find the right angels/VCs and maximize your company’s value. I also have a complete section of how to negotiate a term sheet.
Assembling a high-powered team: Along the way, Zuck had a great sense of finding the right people at the right time. Part of this was actually to buy companies, through something called acqui-hires. But he also knew when he had to make the painful decisions of letting certain people go.
Finding the best go-to-market strategy: So often, entrepreneurs fail to come up with a way to get a product to the masses. It’s a huge mistake. It’s imperative that you figure out distribution, early.
Financials: You need to know them. Investors expect this. In my book, I go through how to read the income statement, balance sheet and cash flow statement.
Being a CEO: In the early days, Zuck was far from a great leader. It was something that did not come naturally. But hey, this is normal. Even standout leaders like Steve Jobs had to learn.
Transactions: Zuck has bought lots of companies and of course, has taken Facebook public. In this section of the book, I talk about the strategies of M&A and IPOs. While these transactions are critically important, there are many land mines.
Personal Finance: Yea, once you have your grand slam home run, you need to figure out how to manage your money, right? In this part of the book, I cover some of the important aspects of wealth management.
The Complete M&A Handbook: The Ultimate Guide to Buying, Selling, Merging, or Valuing a Business for Maximum Return
I’ve been on both sides of M&A – the buy side and sell side. I’ve certainly learned some hard lessons and yes, they are a part of this book.
As the name implies, I cover quite a bit of ground. Pulling off an M&A transaction is generally complex. But it’s also easy to screw up a transaction.
With my book, you will get advice on just some of these important topics:
Valuation: It’s often more of an art than a science. It is also very dependent on timing (imagine selling your dot-com in 1998 vs 2001).
I go through the major ways to value a company, which include looking at comparable transactions, discounted cash flow calculations and liquidation values.
Preliminary Negotiations: M&A is about projecting confidence. So, do you look weak if you seek out a buyer? Or what if you make an unsolicited offer to purchase a company? Well, in this book, we’ll take a look at strategies to help give you the upper hand on a transaction.
Due Diligence: its grinding stuff and tedious. But you need to make sure you do not buy a disaster. In my book, I take a look at the typical checklists but also rules-of-thumb to uncover any problems.
Deal Structures: M&A can be creative. After all, you can have a deal with no cash! That is, you can use company stock as currency.
In this chapter, I take a look at the various deal structures – and when to use them. There is also a look at the tax considerations, which can prove extremely important for a successful deal.
Integration: After you buy a company, then what? Usually, this is when the real heavy-lifting is required. You need to make sure you get the full benefits of the transaction, which requires a smooth transition with employees, vendors and customers.
Regulations: Small companies somehow think that these do not apply to them. Well, this is a big mistake. Even a small deal can run into such things as antitrust issue. So in this this chapter, I look at some of the factors to be aware of.
Alternatives to M&A: It can be easy for a buyer to get deal fever. But it may mean making a bad deal. Sometimes it’s better to do a partnership or joint venture.