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The India-specific reality the global pieces skip: how Indian acqui-hire consideration gets split across upfront cash, salary hikes, ESOP swaps, joining and retention bonuses and investor payouts, and why loading more onto the share purchase price (capital gains) beats loading it onto salary/bonuses (taxed as income). It also names what actually kills these deals here: disagreements on lock-ins, designations and which team stays.

Acqui-hiring a Startup in India: How Deals Are Currently Valued

From GrowthPal by GrowthPal 10 min read

  • In India most acqui-hire value arrives as salary, ESOP swaps and retention bonuses, not a clean cash price, so structure consideration toward the share price for tax efficiency
  • Buyers pay up for strong, well-balanced teams (roughly 1.5x to 4x revenue via ESOPs/bonuses), but 'very few deals are seller-friendly'
  • Deals most often collapse late over lock-in periods, joining designations and which teams get retained, so negotiate these explicitly, not the headline number alone
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Answers A big company wants to acquire us instead of buying our product. How do I even think about this?
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