5 ms·

That would be a great way to try and lower the purchase price of a struggling firm. Dump a bunch of negative PR on the company through 3rd parties immediately b

That would be a great way to try and lower the purchase price of a struggling firm. Dump a bunch of negative PR on the company through 3rd parties immediately before making your offer.

JonFish85 11y ago
Meh, I doubt it would make any impact on the purchase price. I doubt if any serious buyer is under any illusions about how well FourSquare is doing...
chatmasta 11y ago
Negotiations are based on facts, not perception. M&A revolves around balance sheets, usage statistics, product strategy, and other metrics based on real data. The press is clueless and articles are worthless in the long-term.
- taylorwc 11y ago
  Not so much. Any negotiation is heavily influenced by perception and emotion. What you're describing is more true of a pure financial acquisition, but way less true of a strategic acquisition. Fear of missing out, which not generally based on facts, can drive acquirers into a frenzy and drive a valuation halfway to the moon.
  - chatmasta 11y ago
    Good point and nice distinction between financial vs. strategic acquisitions. But keep in mind there are two sides to the table. If a potential acquirer unleashes a frenzy of negative press leading into an acquisition, it could be obvious to the company being acquired, which could negate any points based on the negative press.
    - netrus 11y ago
      Or, if it is a social network, acctually hurt the value of the company to be acquired. It's certainly a good thing for a social network to have the status of "the place to be" and not "the sinking ship".
- genericresponse 11y ago
  Not entirely. Negotiations are begun and concluded with data, but people negotiate on how to interpret the data. As Lord Byron said there are 3 kinds of lies: Lies, Damn Lies, and Statistics. Also- if you can influence more passive owners (controlling or otherwise) that the company is doing poorly you can try to gain board support. One of the key principles in negotiation is your best alternative. What if you can change the perception that the best alternative strategy is poor.
mapgrep 11y ago
You're talking about a company that, within the last year, lost its CTO/first employee, COO, head of bizdev and head of PR, whose top early investors (Union Sq Capital and Andreessen Horowitz) sat out the last round, and that the press (including TC) were openly talking about running out of cash in 2013. My only point being, no need for Yahoo to dump negative PR.

That would be a great way to try and lower the purchase price of a struggling firm. Dump a bunch of negative PR on the company through 3rd parties immediately before making your offer.

JonFish85 11y ago

Meh, I doubt it would make any impact on the purchase price. I doubt if any serious buyer is under any illusions about how well FourSquare is doing...

chatmasta 11y ago

Negotiations are based on facts, not perception. M&A revolves around balance sheets, usage statistics, product strategy, and other metrics based on real data. The press is clueless and articles are worthless in the long-term.

taylorwc 11y ago
Not so much. Any negotiation is heavily influenced by perception and emotion. What you're describing is more true of a pure financial acquisition, but way less true of a strategic acquisition. Fear of missing out, which not generally based on facts, can drive acquirers into a frenzy and drive a valuation halfway to the moon.
- chatmasta 11y ago
  Good point and nice distinction between financial vs. strategic acquisitions. But keep in mind there are two sides to the table. If a potential acquirer unleashes a frenzy of negative press leading into an acquisition, it could be obvious to the company being acquired, which could negate any points based on the negative press.
  - netrus 11y ago
    Or, if it is a social network, acctually hurt the value of the company to be acquired. It's certainly a good thing for a social network to have the status of "the place to be" and not "the sinking ship".
genericresponse 11y ago
Not entirely. Negotiations are begun and concluded with data, but people negotiate on how to interpret the data. As Lord Byron said there are 3 kinds of lies: Lies, Damn Lies, and Statistics. Also- if you can influence more passive owners (controlling or otherwise) that the company is doing poorly you can try to gain board support. One of the key principles in negotiation is your best alternative. What if you can change the perception that the best alternative strategy is poor.

mapgrep 11y ago

You're talking about a company that, within the last year, lost its CTO/first employee, COO, head of bizdev and head of PR, whose top early investors (Union Sq Capital and Andreessen Horowitz) sat out the last round, and that the press (including TC) were openly talking about running out of cash in 2013. My only point being, no need for Yahoo to dump negative PR.