Monday, April 5, 2010

How to sell a company....

It's been a heck of a couple of months... but one thing I did was sell the assets of a fallen company. It's not an experience I'd recommend for anyone. Ever. It's tragic. It's emotional. It's wicked hard. And, there are a number of details I wish someone would have told me on day 1. Stupid details. So, I'm sharing them with you. 

The biggest piece is this: The list of documentation you need. Start this on Day 1. It will take weeks. Literally. Locate each of these things, and if possible, hoard them all in 1 place:
  • All the code, including any forked code.
  • All the backup servers, including the subversion system. That proves the timing of the implementation, which is critical to patent defense.
  • All copies of all filed an unfiled patents, including any legal challenges. You may be surprised to find that your company may not have this information, and the patent lawyers may be somewhat annoyed that your now-defunct company is trying to get out of paying their bills. So they may be less than responsive.
  • All inventor notebooks.Often, the employees themselves have these. Catch 'em before they move to Alaska.
  • All employment contracts for all inventors listed on any patent. 
  • All signatures waiving rights to inventions. Those are typically stored with the filed patents.
  • All documentation (digital and physical) of unfiled IP, future plans, etc.
  • All trademark and trade name information.
  • All sales contracts, including copies of the standard EULAs as well as any custom contracts
You'll have to send all of this to the acquiring firm. I promise.

Also, you should:
  • Read all non-standard contracts for dissolution requirements
  • Develop a plan to inform all customers and potential customers with whom you're actively engaged to tide them over until you know whether the acquirer wants to maintain the relationships/code base
  • Gain access to the license server to give extended trial licenses to anyone who might need them
  • Preserve all critical hardware that may be needed by the acquiring company
  • Preserve the web site, salesforce.com implementation, and other infrastructure that may have value to the acquiring company
It's a lot of hard work. But this is the start. Lock it down... and then you can start sales... 

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