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4 quotes from 1 episode on M&A Science, each with a timestamped link to the source.
Bill Stone approaches acquisitions by demanding immediate staff reductions while protecting founder equity. Product and marketing discussions stop entirely during a deal until acquired management provides a list identifying the bottom 20% of employees.
During the Carlyle transaction, Bill Stone retained a 30% equity position while the sponsor acquired 70%.
“I was always very cognizant of making sure that my equity position, even when I went private with Carlyle, they bought 70% of us, but I owned 30…”
From Bill Stone on Scaling Through 100 Deals Without Losing Equity
Workforce reductions specifically target the bottom 20% of performers to ensure the top 80% of staff stay at the company.
“You keep the top 80%. You don't go willy-nilly and lose the top 20%. They are supposed to be numbers 80 through 100, not numbers one through 20.”
From Bill Stone's Playbook: $250K Revenue Per Head and 40% EBITDA
Acquisition sprees often shrink a founder's ownership position. Bill Stone says this equity dilution ultimately transforms an owner into an employee.
“If you end up diluting yourself with equity raises or other things, what ultimately happens is you're not an owner anymore. You're an employee…”
From Bill Stone on Scaling Through 100 Deals Without Losing Equity
“Don't tell me about your product plans. Don't tell me about your marketing plans. Where's the list? The list of the 20%. Who is staying? Who is going? We are not doing anything until I get the list.”
From Bill Stone's Playbook: $250K Revenue Per Head and 40% EBITDA
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