Yes people have the gumption to ask for numbers like that, and yes that's how it works. What you described is a heavily abbreviated version, but it's pretty muc

Yes people have the gumption to ask for numbers like that, and yes that's how it works. What you described is a heavily abbreviated version, but it's pretty much it. Startup founders sit down with corp dev folks at a larger company. They've had a dance with them before even setting foot onsite, now they'll dance again in this meeting and similar meets for several months. A number will be proposed to the founders by the corp dev folks after they've done a fair bit of wooing, the founders can choose to push back or take it. They'll hash out details of the acquisition, such as finances, logistics, long term strategy, etc. But long story short, yes, they ask for really high numbers. It's not so much "gumption" as it is "you know what you're worth and you don't want to leave money on the table."