Reading between the lines, it sounds as if your market might have some overlap with, or technical dependency on, the acquirer's market and ecosystem--perhaps ev

Reading between the lines, it sounds as if your market might have some overlap with, or technical dependency on, the acquirer's market and ecosystem--perhaps even only allowed to thrive at their pleasure. From the acquirer's motivation, it could be that they're trying to fill a niche they have no desire to invest in organically, especially if there's not a lot of growth in that niche. If it's as you say, I think the question to answer is "Can we stand to be employees again, in particular, as employees of this company?" If you can, then this starts to look more like a job offer, in which case you need to negotiate more cash up front and more favorable vesting terms. (This may also explain why the future employer says the tone will change if bankers get involved. They probably see this as a talent acquisition with revenue attached. Getting a lawyer involved makes sense no matter what.) If you can't see yourself as an employee, then my guess is that you're fearful that your market is going to go away (and the acquirer may suspect that you're road kill). In which case the thing to do is start trying to diversify outside the niche as the current niche revenue stream winds down. Is there time to do that? End of rampant speculation. Good luck.