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Should Your Company Be Considering a Non-Tech "Acqui-Hire"?

Recruiting is tough.  Sometimes you need to be innovative.  

Think way outside the box - are there small, struggling companies out there with key talent your company could use?  What if they were small enough and you could take ALL the employees, rather than just a few?

Enter the Acqui-hire.  It's when you do an acquisition, but have absolutely no interest in the product or services of the company you are acquire.  You just want the talent - the employees.

Acqui-hires are becoming common in the tech industry. More from VentureBeat:

"An acqui-hire is when a larger, [presumably] thriving company scoops up a younger, [presumably] struggling company. The acquirer is generally not interested in the startup’s product — it wants a team of engineers with a history of working together.

Forty percent of companies in the study did not disclose any funding prior to acquisition. Twenty-one percent raised less than $1 million, and 25 percent raised between $1 million and $5 million. Eighty percent of acqui-hires occur before a startup raises its third round of funding.

When CB Insights looked into the alleged “Series A crunch” in 2012, it found that the average seed-funded startup needs 13 months to raise a follow-on round. That acqui-hires generally raised funding about 15 months before acquisition is therefore significant, because it is right around the time a startup may be coming to terms with the fact that it can’t raise more money and is running out of any funds it had.

The startup gets a more graceful exit than a failure, and the acquiring company overcomes the “dearth” of engineers."

So the question for you is this - are there small companies - think 5-10 total employees - that are flat from a growth perspective and struggling to make it that might be open to joining you?  If these companies are losing money or simply breaking even, would the founders consider joining your larger firm as a way out - especially if you provided employment opportunities for others they feel responsible for?

When you think about an acquisition, you probably automatically think it's out of your reach due to cost.  The reality is that founders of some young and struggling firms in your industry might be looking for a graceful way to close the doors, and it might cost a lot less than you think.  What if you paid the equivalent of high end contingency search fees (25-30% for all the positions you're briging over) to the founders and locked them in with a 1-2 year employment contract?  I guarantee you there are some very small firms in your industry that would be open to that.  But you have to ask and engage.  

You don't know until you ask.

I think the acqui-hire can work in industries outside of tech.  Based on the circumstances of the small company in question, it might cost you less than you think, and you might be up some great hires as a result.

Be creative. 

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