AdEspresso recently announced that it had been acquired by Hootsuite. If you aren’t familiar with the service, AdEspresso is an awesome tool for Facebook advertisers to AB test massive amounts of ad variants in order to see what resonates. The have some great ancillary tools as well – analytics, rule-based ad settings, visualizations – that can all save time for advertisers, especially when dealing with complex campaigns.
After the deal closed, the people at AdEspresso put together a guide on how it all went down. This is a very helpful read for a) startup folks who have never worked on a sale transaction and b) corporate M&A folks who haven’t worked with startups.
At Dozen Digital, we’ve used AdEspresso with a few of our large clients who have substantial media budgets. With giant budgets, just managing campaigns/ad groups/ads can be a full-time job, leaving no tome to actually be thoughtful and creative… so AdEspresso can a lifesaver for a small agency like ours. Startups with small spend frankly don’t really have a good use case for hundreds of ad variants – you won’t learn anything by spreading your budget that thinly.
It’s also worth noting that AdEspresso is one of the best examples of using great content to generate awareness and sales. Our team had been reading their guides, browsing their ad libraries and downloading their whitepapers for months (years?) before we became a paying customer. Once we signed up, we felt like we already knew them – they’d built our trust before even showing us the product. This is a very important concept and probably warrants a while separate post. (Honestly, I bet that content library, brand, trust and content generating machine played a part in Hootsuite’s interest in the first place)
Anyway, after completing the sale to Hootsuite, the team AdEspresso put together a recap of how the transaction went down. I found this post helpful, if only because it illustrates that a sale process is serious business and can’t be shortcutted or “hacked”, which can be frustrating for a startup CEO. These things take time and they almost always feel inefficient.
Before working in venture and in customer acquisition, I had a corporate finance background. I handled lots of commercial agreements and acquisition talks while I was working at BAML, so most of the details about legal talks and document drafting wasn’t a surprise. That stuff is a reality- acquirers need to be careful about what they’re buying and signing up for.
The real gems in this post are about the reality of actually running a sale process. When to talk to your board. What certain steps actually mean. How draining the process can be. How sale due diligence compares to VC due diligence. All of these insights are invaluable for a startup CEO who has never been through it before. I’d recommend taking a look here:
Here’s the link to “AdEspresso joins Hootsuite — Anatomy of an M&A”