Mobile Machinations

The Essence. The Soul. The Human Side of Mobility

You may remember a book that came out in the early 1980s – Tracy Kidder’s The Soul of a New Machine. The book focused on the machinations behind old time minicomputer vendor Data General and its intense efforts to get an important new machine out the door. As Wikipedia puts it: The book “chronicles the experiences of an engineering team racing to design a next generation computer under a blistering schedule and tremendous pressure…”

I mention this because pulling together M&A in this day and age, especially in the heated world of mobility, isn’t much different – a management team racing under a blistering schedule and tremendous pressure. Hence, “Mobile Machinations” is about the soul of a new deal — an opportunity to dig behind the scenes, behind the blistering schedule, behind the engineering, and behind the ‘emotions’ needed to make deals – whether M&A, business development, partnerships or sales – happen…and how to turn them into reality.

As Antenna’s CEO, I’ve been involved in four M&A deals since 2003. All of them have been acquisitions on our part. Each deal had very specific drivers behind it and different emotions as well.

One very interesting aspect of M&A has to do not so much with how a given deal affects the companies involved, but rather how a deal affects the market you are doing business in. The right deal can easily shape a market in dynamic and strategic ways that create entirely new business opportunities; a deal can simply deliver tactical benefits, such as eliminating competitive noise in the marketplace; or a deal can fundamentally change the way a company does business inside of its market – a more subtle way to think about market shaping.

More often than not, the companies involved in a deal are likely to have known each other for a fairly significant period of time. They can be hostile enemies or friendly competitors when squaring off against each other in the marketplace. There are always underlying emotions at play in the heat of competition. And there are certainly emotions at play when a possible deal scenario emerges. More often than not those emotions will likely make or break a deal.

Can you make a deal simply because of the pleasure it may give you to finally put the screws to a formerly hostile enemy? Do you simply make a deal because you’ve become good friends with a competitor you perhaps have grown to like? I can tell you firsthand – those emotions are absolutely there at the front end of any deal. And they are real.

Truth be told, most deals begin way before they actually occur usually based on the relationships between the CEOs of the respective firms. Having an existing relationship with a peer or competitor makes the process of a deal easier – not easy, but easier. As an example, Antenna’s recent acquisition of Vaultus was made easier based on the fact that I have known their CEO for many years and always made a connection whenever we were at an industry event. In addition I kept in regular contact with a key Board member. The first discussion of merging actually occurred 7 years ago!

So in addition to the actual science and accounting forensics that are necessary in a deal, a certain level of emotions – we can call it art – is necessary to provide that strictly unscientific ‘gut feeling’. My own emotions focus not on anything personal in nature, but directly on how I feel about how the deal will affect both the overt and subtle shaping of the marketplace. Do I feel confident that the marketplace will become more favorable? Or does an honest emotional assessment reveal an overriding nervousness about it?

Often times the best decisions are the decisions to walk away. While we have done a number of deals recently, it pales in comparison to the number of opportunities we have reviewed and turned away from. If it doesn’t feel right, it’s better to walk away – you need to trust your gut.

A management team racing under a blistering schedule and tremendous pressure…Will I play, or will I walk away? The combination of art and science is the only way I know.