The term M&A is a broad one that means different things to different companies in different deals. An M&A transaction may refer to one company purchasing or absorbing another, a merger where two companies join together, an acquisition of major assets in a company, a tender offer to buy a company’s stock, or a hostile takeover. Companies large and small, public and private, need ongoing counsel to help them identify, structure and execute the deal that’s right for them, provide the legal framework that can optimally make it happen—and then make sure it happens successfully.

Louis Lehot represents buyers in creating acquisition programs, selling companies, purchasing assets, merging with other firms, and licensing. Louis’s clients range from bootstrapped startups to venture-backed emerging growth companies, to public companies, and the venture capital and private-equity financial sponsors that fund these entrepreneurs. His clients have included venture capital and private equity firms and corporate venturing groups that make investments in technology, healthcare, clean energy, and other innovative businesses.

Louis’s aim is to achieve liquidity events that are win-win for both sides, entrepreneurs and investors, and to create the right market fit for the innovative products involved.

Mergers and acquisitions represent one of the most common and often the most beneficial exit strategies for startups. M&A plays a leading role in integrating innovation into markets over the longer term. 

Tech entrepreneurs and startups are driven by much more than profit. These innovators are passionate about their inventions and want to see the products they develop in action, changing people’s lives and becoming mainstream in the long term—from new medicines to AI applications and apps that help manage your diet.

By finding the right M&A partner and negotiating the optimal deal, startups can both cement a strong future for their innovation and achieve the best financial results for the innovators and their investors.

When startups reach maturity, they have to take the next step. For the majority, an IPO is either not possible or is not the best option. For instance, the inventor of a fingerprint biometric scanner for smartphones has a product better suited for an M&A, since the technology is only a small part of a bigger device.

However, finding the most suitable M&A partner and structuring a deal that meets the startup’s and founders’ hopes and goals can be difficult. Wrong decisions and wrong deals can destroy years of hard work. And that’s only step one Step two is where legal acumen and execution come into play, outlining the deal and overseeing the due diligence needed on both sides. 

The process of investing and acquiring startups can be wildly lucrative, but at the same time wildly risky. Parties on both sides of a deal need to find the right partner, the right deal, and importantly, the right legal counsel to ensure the best options are sought and that everyone does their part to ensure success.

Legal counsel create the legal framework to make it all happen. This includes:

Structuring the deal. A well-structured deal maximizes returns while minimizing risks. At the same time, transactions must meet regulatory requirements and serve the interests of investors and partners on both sides.

Contracts. Governing all investments are the documentation and contracts that outline the deal and spell out all that is expected. Legal counsel behind these investment deals drafts investor agreements, shareholder agreements, and employee contracts—all to apportion the risks and rewards, incentivize and align the parties for success, reduce the likelihood of disputes and have in place a plan of action for when disputes do arise.

Due diligence. A strong legal team helps an investor test the price and conduct thorough due diligence (and a company defend price against a thorough due diligence investigation) to identify legal risks in a deal. Issues may involve commercial contracts, intellectual property rights, regulatory compliance, past or ongoing litigation, and other legal aspects. 

Risk management. Legal teams identify and mitigate potential legal risks in investments, including everything from assessing potential legal liabilities to protecting investors’ interests.

Exit strategies. Both sides of an investment are there for the same reason: Reaching the point where it all pays off. A well-structured and documented deal will outline exit strategies so that when the time comes, all parties are ready with a roadmap in hand.

Dispute resolution. Disputes will happen: It’s human nature and it’s why the best legal counsel is sought for investments. Strong counsel will both anticipate possible disputes and seek a favorable resolution when they occur.