Five Startup Acquisition Tips From Well+Good's Founders
By Elana Lyn Gross, WOMEN@FORBES
Leaf Group, a diversified consumer internet company comprising several marketplace and media properties, announced on June 6 that it has acquired the wellness media company, Well+Good. Leaf Group's fitness and wellness vertical now includes Livestrong.com and Well+Good, bringing the combined reach to 36 million unique monthly visitors, according to the announcement. Leaf Group purchased the outstanding equity interests of Well+Good for $10M with the agreement to pay incremental cash targeted at $9M upon the achievement of operating targets through the end of the 2020 fiscal year.
Well+Good's founders, Alexia Brue and Melisse Gelula, noticed the emergence of the wellness lifestyle early on and founded the publication in 2010. Brue and Gelula have bootstrapped the company since it's founding and, as Well+Good's readership has grown, the team has expanded to produce revenue-generating partnerships, products and events including their Well+Good TALKS with industry leaders and Well+Good Retreats. The founders will continue to run day-to-day operations from their New York City office in addition to overseeing Leaf Group’s fitness and wellness category. I spoke to Brue to learn her advice for other founders who hope to have their companies acquired.
Build the company you’re passionate about building:
"Ultimately a great business comes from passion, that feeling that you’re creating something that needs to exist and has a clear purpose. Even if your ultimate goal is an acquisition, you could end up running the business for much longer than you expected, so it should be something you care deeply about and will want to work on for many years to come," says Brue.
Establish strong relationships with potential acquirers:
"Acquisitions can be years in the making, and it’s a smart idea to be out telling your story and what you stand for—as well as learning about other businesses and how you might fit," says Brue. Well+Good partnered with one of Leaf's portfolio brands before the acquisition, and Brue says that it deepened the relationship with the company. By building in-depth relationships with key people, you'll be able to better evaluate whether your mission and values are aligned. "Never be in a position that you have to do a deal. Both from a financial and a strategic perspective, you want to stay in control and be selective and thoughtful about choosing the right partner," says Brue.
Know what you want out of an acquisition:
Evaluate what you hope to get from the partnership, such as funding, complementary skills or a large team. "In our case, Leaf Group was an ideal partner because they brought expertise in SEO, digital product, analytics and an already strong fitness and wellness platform in Livestrong and MyPlate," says Brue, "They also have a deep commitment to growing the fitness and wellness category and to Well+Good’s crucial role within the category."
Build a strong team around you:
Brue credits Well+Good's talented team with helping to make the company an attractive acquisition target. "There are a lot of smart, innovative ideas out there but ultimately what makes a company special are the people and the ability to execute on those ideas," she says.
Hire a good lawyer for the sale process:
When you are going through the acquisition process, it's beneficial to have a lawyer who specializes in mergers and acquisitions. "In our deal, there were good lawyers on both sides and we ended up with an outcome that we all feel is fair and motivating. But we know of other companies where this was not the case, and we could see how things could have turned out differently if we didn't have the right lawyer," says Brue.
To view the entire article, please visit https://www.forbes.com/sites/elanagross/2018/06/18/five-startup-acquisition-tips-from-wellgoods-founders-who-just-merged-with-leaf-group/#44976aea1263