When it got serious with Anders, Adam and I outlined five things we needed to make sure we were all on the same page about before we could actually strike a deal. First, our director team—and the entire team in general—needed to be taken care of, in terms of their compensation, benefits, workload and status. That was a non-negotiable. We weren’t just concerned with protecting our people as individuals; we wanted to protect our working relationships. That meant we needed to ensure Summit would continue to operate as an independent unit running separately and not dissolved within Anders. Summit didn’t need to merge, so we weren’t going to go into a situation where our employees were divided up and used to fill gaps in the Anders roster. The true incentive behind the merger was always to double our five-year goal, from 25 to 50 million. In order to do that, we needed to keep our team together. We also needed to preserve our growth engine: our national brand. It’s what drives our revenue, as clients get to know and trust us from our speaking engagements, pod- casts and blogs. The meaning behind the brand—our reputation as a non-traditional
accounting firm—is also our HR pipeline: We hire the person who is running away from a traditional accounting firm. So in order to keep up with our ambitious growth, we knew we would need to continue to appear on a national stage as the Summit everyone has gotten to know and trust. Then, in terms of the structure of the deal, we also had two deal-breakers. We didn’t want to follow the traditional accounting firm part- nership model buyout where partners receive their buyout upon retirement. Also, we didn’t want it to be treated as an acquisition where we get bought out on day one of the merger. Instead, we settled on an agreement where we would take some of the chips off the table on day one, and get the rest based on our value once we’ve hit our numbers after five years. Based on our history of doubling our size every three years, we expect the value to be significantly greater in year five than today, so that overall value will be bigger. The idea is to incentivize the leadership team to continue to grow the company, not just to fall in the mix. This creates a big win for both Summit and Anders. A key part of that long-term vision is the fact that Adam and I wanted to be equity partners, in order to have a seat at the table and be part of the decision-making process throughout.
GETTING ON THE SAME PAGE
Five Conditions for Merging
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