A canonical example of how all-stock deals can go horribly, horribly wrong is the sale of Dragon Systems (the voice recognition software), whose founders lost e

A canonical example of how all-stock deals can go horribly, horribly wrong is the sale of Dragon Systems (the voice recognition software), whose founders lost everything when the acquirer declared bankruptcy mere months later: http://www.nytimes.com/2012/07/15/business/goldman-sachs-and-a-sale-gone-horribly-awry.html http://www.nytimes.com/2012/07/15/business/goldman-sachs-and... Dragon was advised by Goldman Sachs, whose compensation was fixed regardless of the deal terms (and regardless of the sustained performance of the combined entity) so long as the deal closed - all too common in the world of investment banking. Essentially, the seller's advisors had every financial incentive to skimp on doing due diligence on the buyers; had they received compensation in the same form as the founders, the outcome might have been very different. One hopes that Meetup received better advice than Dragon did! (Disclosure: I work for Belstone, a tech-enabled merchant bank where we attempt to align ourselves much more closely with the companies we advise and partner with. Feel free to reach out via the email in my profile if you want to learn more about what we do - we're hiring for software engineering and associate positions!)