How Brainstorming a Shortlist of Potential Acquirers Can Pay Off

woman draw a light bulb in white board

When David Perry started his video game company, Gaikai, he thought about all the companies that may want to buy it one day. In essence he was creating a shortlist of potential acquirers. And also creating a quick way to find a good fit.

Now typically when you think of startups, one word comes to mind: growth. So why would a business without any revenue or employees be thinking about potential acquirers so early? 

For Perry this is just “down-the track” thinking at work. Rather than waiting for the right opportunity, he wanted to drive the process.

The Strategy

Later when Perry was interviewed about Sony’s $380 million acquisition of Gaikai, he described his philosophy by using a moving train as an analogy. 

Think about a train full of people representing an industry, he explained. Most people are comfortably inside the train watching the countryside go by. There are some people scrambling behind the train, hoping to jump on.

Then there are a select few people who are obsessing over where the train is going and are constantly thinking about the upcoming stops along their journey. Perry described himself as one of the people thinking about where the train is going next, so it only made sense to him to have a list of potential acquirers from day one. 

Sony was in the bullseye of Perry’s dartboard of companies to sell to. So when his partner suggested they name their company Gaikai, a Japanese word that roughly translates to “open sea,” Perry agreed. 

He knew it would be the perfect fit for what he had in mind. He also knew he had an opportunity not just to create something unique but to build a connection to his target acquirer.

And while the word gaikai is hard for the average English speaker to pronounce, Perry knew the name would be irresistible to Sony. 

More Than Just A Name

Perry and his partners went further and named other parts of their product line with Japanese words. They also designed the company for the global gaming market, not just for American customers. It was a unique tactic that differed from the habits of video game makers at the time. 

Years later, when Perry was ready to sell Gaikai, he approached all the big video game makers about buying his company. Unsurprisingly, Sony was the most enthusiastic. They were thrilled to see the extent to which Perry and his partners had gone to make Gaikai fit Sony’s culture. 

The Takeaway

Visualizing the shortlist of potential acquirers when you’re making key decisions in forming your company is an excellent way to vet your next move.

Imagining how your potential acquirers would react to hear how you are thinking of evolving your company can inspire a more strategic lens through which to make big bets. 

Whether you are looking to sell soon or are years away from selling, the process of developing a shortlist of tomorrow’s potential acquirers will help you make better decisions today.


Want to learn more? Speak with us about how we can help you think through the strategy of selling your company some day.