In this episode, Josh talks about about culture and acquisitions and how it’s going to impact your organization.

Episode 47 | Culture In Acquisitions

[00:01] Welcome to The Epic Company Culture Podcast, where your host, Josh Sweeney, will give you the business leaders, HR professionals, and company culture aficionados, the knowledge you need to take your company culture to the next level.

Josh Sweeney: [00:16] Hello, my name is Josh Sweeney, and welcome to The Epic Company Culture podcast. Before I get started, I would like to thank Prototype Prime for this amazing podcasting space. Today we’re going to talk about culture and acquisitions, so growing through acquisition and having being part of an acquisition, whether you’re a team member, whether you’re an entrepreneur and you’re growing through acquisition, whether you’re getting acquired. Whatever is happening in your world or may happen in your world around acquisitions, can have some very interesting outcomes and complexities. I’m just going to share a little bit of food for thought for you today. Along with a story around an acquisition that I was a part of.


[0:55] When I was at Spy Dynamics, we had an amazing company culture. I’ve mentioned this before on the podcast, how it was one of the best places I’ve ever worked from a culture perspective. Work hard, play hard, high performing people, everything you could think of in a company that I liked, or everything I could think of that I liked was pretty much ingrained into it. During that experience or towards the end of that experience, we got acquired by HP, Hewlett Packard. This was an interesting experience because I had never been in an organization and gone through the acquisition piece.

[01:31] I was at another company and I left shortly before the acquisition, so I was right in the midst of this one. And what had happened during this was we get acquired, and we go into a meeting at the HP headquarters, and one of their heads of acquisition or whoever was working on that, gets up on stage and they start talking about how culture is the most important part of an acquisition. So, they tell us about how this is the most important part and how important it is, what they look at it from this perspective and that most of the acquisitions fail and why this one’s gonna be better. Reinforcing how well this process is going to go.

Different Cultures

[02:14] The interesting thing is, when you look at it in a backward sense, through the experience that I went through, they couldn’t have been more right in that culture is a huge piece of the acquisition. And on top of that, they couldn’t have been more drastically wrong, in the fact that these cultures were not even close to a match. Once we were on- boarded at HP, we found that it was a fundamentally different organization, which is to be expected. I mean, we’re going from a roughly a hundred-person company to, I’m assuming fortune five-hundred company, I don’t know exactly where they rank, and that it’s a fundamentally different culture.

[02:55] Over the course of probably three months, we pretty much saw all of the things that made our culture unique at Spy slowly disappear into the HP behemoth of that time. That led to a lot of attrition, that led to a lot of knowledge and talent going out the door. Again, that person was dead on about the culture match and the success of that and now, as far as I know that product is a part of their larger suite, from where we were, which I saw as an industry leading product to where it is now. With that they couldn’t have been more accurate.

[03:33] I wanted to convey the message around thinking about what the culture matches if you’re going through an acquisition. Or if you’re looking through to grow your company through acquisition, any of those, how are you analyzing that culture? Are you really sitting down and saying, what is our culture book look like? What are our checks and balances? How do we operate, who are we and who are they? Are you making the leap and saying it’s a good acquisition because financially it looks good and you’re going to just say that the culture match, or have you really dug down into the culture match to understand, is this going to work out for the long-term?


[04:10] Also with that, I think it’s good to have a strategy around that, so if you’ve gone through or you’re like other private equity firms or venture capital firms and you’ve worked with us on some of these items, or if you’re going at it alone, make sure that you either know it’s a culture match or go ahead and plan for the attrition, plan for the event that it’s not a culture match and set those expectations differently because you know that people are going to leave at a different rate with one culture versus a strong mismatch. Hopefully if you’ve ever gone through an acquisition or going through those are looking at growing your business through acquisition, make sure that you’re analyzing whether it is truly a cultural match and if it is not, understand how that’s going to impact your organization.

[05:01] Thank you for tuning into today’s episode of The Epic Company Culture podcast with Josh Sweeney. If you enjoy this content, please subscribe on iTunes, Soundcloud, or Stitcher. For additional content and transcripts, visit epicculture.co. If you have questions or topics you would like us to address or expand on, tweet us @epicculture1, or email at podcast@epicculture.co.