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Successful End-to-End M&A

"If you want to be a successful practitioner, you have to understand the end-to-end process. You can't just be great at deal mechanics or negotiations." - Hannah Elsakr

Teams need to understand how strategy can impact the entire process in order to be successful in M&A. In this interview, Hannah Elsakr, Vice President, Corporate Development, M&A Integration at Adobe, discusses executing successful end-to-end M&A.

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Hannah Elsakr

Episode Transcript

Front-end Alignment

Adobe is a leader in digital experiences and creating digital experiences for the consumer, and it always starts at the top of the funnel. The same thing for M&A, the top of the funnel for the company, is the strategy.

We have three clouds: a Creative cloud, a Document cloud, and an Experience cloud. And as a practitioner, my number one thing is to understand the strategy behind each of those clouds and where our C-suite is focused on accelerating.

First and foremost is always going to be organic growth. That's what we do. But we can accelerate it with acquisitions, investments, or partnerships. We really have to understand what the strategies are.

If you're too narrow in your focus as a corp dev leader, it will be hard for you to relate to and understand what business leaders are thinking about. I encourage folks to spend time in product management. It just gives you a real insight into what matters.

M&A is not just a spreadsheet exercise. It's really about making it happen, and that happens in the strategic front end.

The transition from Integration to Corp Dev

I started as an engineer and did investment banking after graduating from MIT. When I went to my first role in CPG at Avon, that was the first opportunity I had in a line role running a P&L, and I was thrust into that.

When I came to Adobe, it was a great opportunity, and they wanted a real operator to run the integration. At that time, we had bought a couple of very large companies, and it all evolved because Adobe's leadership decided to make that shift and expand. Adobe has an inclusive and highly innovative culture, and they lean into people. They had a vision for corporate development, being very strategic and well-pulled through to the operations.

But I told them that we want an operator sitting and doing the front end because it'll ensure we do the right deals upfront.

Working with Business Leaders

Experiential strategy and people are the two parts of front-end M&A. And that’s both the deal sponsor and the target leadership and their strategy. I’m in the software industry, so there are no assets, it’s the IP and the people.

It’s important to partner hard with the business unit leaders to get clarity around their thesis. So we use a tool together where we co-author a strategic thesis for M&A with the business unit and push back on each other before we lean in and do a lot of work.

And that’s an important artifact because it’s a way to get clear sponsorship around why we want to do this and what it will do for the company. Of course, every deal has a different thesis. But the things that I tend to push on for clarity are:

  • What have you done organically?
  • If that’s something important, what have you done organically in this space?
  • What have you done from a partnership angle in this space?
  • Why is an outright acquisition important to you?
  • What was on your business roadmap?
  • Is this about using M&A as R&D?

We have that dialog upfront before we get to the numbers. So before we start running spreadsheets, let’s bring clarity to the front end. Spreadsheets are just spreadsheets. We’re asking questions to validate the thesis. The core question is why should we do this.

It’s just breaking the problem into its logical pieces and figuring out which assertions and which hypotheses in your thesis don’t hold true or you need data.


We’ve got a committee. There are stage gates that we go through. But the strategy upfront takes time to develop clarity around. And we want to spend time with the leaders to do that.

We only move forward if we have somebody in the C-suite who will own the deal. So we work hard to get that alignment upfront so that when we get to the CEO, the thesis doesn’t fall apart and we don’t waste three to six months which is hugely demotivating for a team.

Handling Inbound Deals

We don’t control external timelines. So if somebody’s for sale and they’re running a process and they have a timeline, those will come. So my goal is to reduce our surprise factor, and it doesn’t have to be on a specific name of an asset, but thematically, we’ve done a lot of work.

The whole team has worked with the executives to understand where we would want to accelerate thematically. And so, regardless if it’s company A or B, there are thematic spaces that we’re watching that we do pre-work on. And therefore, at any moment, if something in that related space comes up, we’ve already done the front end of the strategy.

Not about a target but about the thesis. And I think that’s an important difference. We know the things that we’re really interested in and we’re not going to drive the timing necessarily. Sometimes we may, sometimes we won’t, but we know what we’re interested in.

Effective Proactive Sourcing

Everyone on my team has different strengths, and those with decades of banking experience surely bring something special to the table. And in the space I live in, a lot of it is getting to know and connect with founders of high-gross SaaS companies.

We also have a direct investing program. It's very selective. But it allows us to also look around the corner and possibly put capital to work as an investor on a cap table of a company we're interested in.

Keys to Success

Adobe is all about the product and the people. Adobe's a very special culture in itself, and it goes back to our founders. They were people-first leaders, and we're a product company.

So our strategy is focused on the IP.

  • What's the product you're getting?
  • How great is that product?
  • How it's complimentary to what we do? 

And then it's the talent, from the founder or the CEO down to his leaders to the QA engineer that's coming in as part of Adobe. And our approach is on post-merger integration.

We change every time we acquire a company. So we don't just expect the company to snap to Adobe. Adobe changes every time, and we should be open to change every time. And I found that to be genuine and true.

And every integration I've led, we're open to taking elements of not just the culture but the processes of the target company. But don't misunderstand me, we’re definitely looking at companies and how their culture matches ours.

If we can't see the leadership team meshing inside the Adobe leadership team or being part of it, sometimes it's a strategic disagreement and a vision and strategies don't come together from leadership teams, that will be very hard. So these are the things that you think about early in the process.

Red flags around culture

It's not about red flags. We're talking end-to-end, so as a deal leader, you're not trying to just get a deal successfully across the line and signed. You have to think all the way into value realization for the shareholder. And we are software; we only get people and IP.

So we need to think all the way through

  • Who are the leaders in place?
  • How deep the bench is?
  • Who are the culture carriers?
  • Who will help you through change management when the company comes in?
  • How would you structure that in pre-sign talent and pre-close talent?
  • How do you think about retention?

And I don't think there's a culture checklist, so this is where it's important to pick the right team internally. So we work to the top and identify who will sponsor this.

I always have a sense of who the culture carriers on our side are. Who the culture touchstones are, and understand what it would take to be successful at Adobe. And that's important to me as I think through team staffing and team dynamics.

And then I think you’ve got to look when you're having diligence meetings with companies; they’re not just about diligence, they're also about understanding the folks, the folks who are coming in.

So we encourage all our teams to keep an eye out for the culture and get to know people while running the workstream diligence.

Building the Deal Team

I believe in diversity of thought. And I have benefited from that in my career. I've built our toolkit diverse, encouraging my team never to stop learning. Don't let somebody tell you you can't.

So we've chosen to recruit folks from every walk of life. Obviously, we have a lot of people on the team who have banking backgrounds or finance backgrounds or accounting backgrounds actually, or legal backgrounds.

And we are all willing to teach each other in that process. So we have learning sessions that we run internally. We bring in a lot of folks to teach. And one thing I encourage all of our team to do is learn one area of Adobe well.

So if you came straight out of business school and all you've done is banking or growth and equity, I encourage them to spend time with a product manager and understand what it takes to ship a product.

Understand what they do so that you can help them during a deal process and help the company translate for those things. So that's my mentality around hiring and staffing for the team.

Here at Adobe, we have so many opportunities to do that. Like all of our folks can enroll in the sales training and enablement. We have a customer program where you can go with the sales leader to call on customers or renew customers. And then, apprentice, go spend time on deals. It's the easiest way when you're living in the trenches with a product leader or an engineering leader.

Diversity of Thought

In M&A, if you think about the role, everyone's a fiduciary for the company. But the corp dev team and the M&A legal team are serving as a check and balance for the company to spend capital on the right things.

And so, you need diversity of thought to ensure you're pressuring everything, but you also have an obligation to dissent. You're not just there to go along with the business leader. So, I encourage everyone on my team to debate and ask questions to the business leader.

You have an obligation to speak up and dissent if you don't believe the assertion or you don't believe it's the right thing to do. At Adobe, the best idea wins. And if you don't have diversity, you could end up going down a path where you didn't uncover all the pieces you needed to uncover. So I think it's paramount as a corp dev leader to have some diversity of thought.

Encouraging Debates

It's all about creating a safe environment for debate. Okay. Debating does not mean you have to yell at each other. This is not a debate team from high school. You can be respectful.

To debate well, you must actively listen and pummel the idea, not the person. Adobe has created an amazing culture and a space for the best idea. Anybody from anywhere can have an idea and get time with senior leaders. We encourage people to speak up.

I call out people and ask them what they think. We don't shut anybody down. It's a very respectful culture. We listen to each other. It's inclusive in that way.

As a leader, you don't want to win every debate because you don't need to be the smartest person in the room. If you are you didn't hire right. I'm actually looking to hire people way smarter than I am on the team.

Capturing the value of the deal

Deals are super dynamic, so I view it as ensuring you have the right ecosystem in place.

  • Who are the right stakeholders?
  • Who's the ecosystem of players that you need?
  • Do you have clear sponsorship?
  • The M&A committee has to be on the sides.
  • The thesis has to be checked.

There are a lot of these pieces. They're not linear gates, but they're necessary pieces. And the other piece is being willing to debate and be wrong.

So you came in with a thesis. If you hold too hard to that thesis and are not willing to hear new information during confirmatory or as you learn things, you will end up in the wrong place.

You must be willing to challenge your thesis and debate yourself constantly. And we do that actively all the time.

Back to the tools we use, after we write this thesis memo, as we go from a signed LOI into the confirmatory period, we have every work stream write their assertions down and return to it.

We ask ourselves if those assertions still hold true. It's important to keep testing and debating yourself, having the right stakeholders at the table. It's also crucial that the leadership is involved and present in the deal process.

The worst you can have is somebody floating at a high level and not digging in, which will cause you to get off track from an intended deal value.

Level of Integration

We're dynamic in the deal process, but you also have to be responsive and dynamic post-close because you learn a lot more things about each other through discovery.

So we always come into that phase with an integration plan. So here's what we intended to do knowing what we knew at that moment, here's what we intended to do from an integration standpoint.

As we discover and learn, we pivot off of that. So we have to be dynamic because if you're going to change the plan of record, you can't do it in a silo. You have to make sure all the ecosystem, all the stakeholders from go-to-market to security to back office systems, everybody has to understand the change that was made strategically so that it can all flow through.

That's the hardest part of being an integration leader- you have to close the loop.

But there is a programmatic part of this. You're not just flying by the seat of your pants. We have an amazing integration management office team: There's a role for templates, processes, governance, check-ins and milestones. We use that process to ensure hygiene.

The thoughts will change every time, but we have this process layer that these leaders bring to the table to ensure we realize value. This is where you want to be creative. You want to be dynamic, but you also need governance. You need a process in the deal process. In the integration process, you need governance and process as well as creativity and being dynamic.

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