Going into the New Year, we got a piece of bad news from our venture capital investors. We found out that they had taken their investment in DecisionPoint as a loss, also known as a write-off. Basically, they were saying that they didn’t think DecisionPoint would succeed, so they were no longer counting on making money from that investment. At their request, DecisionPoint was to be sold to another company. The challenge was that since our venture capitalists had already written off their investment in us, we had little leverage when it came to how much the acquiring company was willing to pay in order to acquire DecisionPoint. This was a tough one for me to accept as I thought our company was worth a lot more than other companies were willing to pay. However, we just didn’t have a strong position in the negotiation.
The challenge that we had during the acquisition process was that we had to keep it quiet, so only the management team and a few select other individuals knew what was going on. Most of the employees were not directly aware of what was happening, which is how we wanted it, so they stayed focused on the task at hand rather than giving up and waiting for something to happen. It was personally very difficult for me to be in this situation as I had close relationships with a lot of the employees, and it hurt me to not be able to tell them what was going on, especially given that my travel to the Bay Area had significantly increased. While I really wanted to talk about it with everyone, I didn’t. It was difficult as there was a part of me that felt that I was lying to them, even though I really was not.
There were several organizations that expressed interest in acquiring DecisionPoint, and we had several different meetings with each organization. However, when it came down to it, there were two organizations that were seriously interested in acquiring DecisionPoint. One was a software company, which I thought would be the more likely acquirer. The second was a hardware company that had purchased several software companies over the past years, and was looking to add DecisionPoint as part of that portfolio. After a series of meetings and negotiations, it turns out that it was the hardware company that ended up with the highest interest in DecisionPoint, and eventually would be the company that acquired DecisionPoint.
During the acquisition process, there was a lot of activity once the final decision was made by the company to acquire DecisionPoint. There was investigation into the software being used along with quality information. There were interviews with existing DecisionPoint customers to make sure that we were doing everything we said we could do. There were also discussions about which employees within DecisionPoint would continue on with the new company, and which ones would be let go. I was officially part of the management team, and I was the only member of the management team that would be asked to continue with the new company. Everyone else was given what I call the “paid to go away” contract. They all made some pretty good money just to go away and not come back. I did get a nice job with a good salary and some extra benefits like stock options in the new company. I also got a small amount of money from my DecisionPoint stock as part of the acquisition. It wasn’t nearly what I hoped it would be, but it was more than zero, so it was still pretty good.
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