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Technical.ly
2 days ago
- Business
- Technical.ly
Most companies don't IPO, so here's how to plan for your likely exit
The most important day of an entrepreneur's journey might be the one when it ends. The big question: Will it end on your terms? That's the dilemma behind most startup exits, whether they take place through a merger, acquisition or an initial public offering (IPO). Experts put that distinction front and center during the 2025 Builders Conference session titled 'M&A or IPO: What is Your Company's Destination?' Moderated by Mike Ravenscroft of the University System of Maryland's Maryland Momentum Fund, the conversation featured attorney Kim Klayman of Ballard Spahr and Alexis Grant, founder of the M&A-focused newsletter They Got Acquired. Together, they laid out a candid, often under-explored roadmap of what founders really need to know about exiting — and why waiting until it's too late to plan is a mistake. 'Think about it early,' Grant said. 'Gives you more options.' The numbers are clear, Ravenscroft noted: Only a tiny fraction of companies ever go public, and even among VC-backed firms, IPOs are rare. The vast majority of exits happen via mergers and acquisitions (M&A). The panelists agreed that the perception gap around what makes an exit 'successful' can obscure the reality of its true impact. A $7 million sale might be life-changing for a bootstrapped founder with majority ownership. But if that same company had raised venture capital at a high valuation, the founder might walk away with little or nothing. 'If someone raises $5 million and they sell for $5 million, they probably didn't get any money,' Grant said. That disconnect is even more stark during economic downturns or slower capital markets. Klayman pointed to the increase in smaller companies acquiring other small firms — sometimes simply to pad revenue, not gain technology. But these all-stock or acqui-hire (in which a company gets acquired for their talent) deals can mask another story: Sometimes, the best-case scenario is simply survival. 'The reality is most companies end up in an M&A situation, even if it's a multi-generational business,' Klayman said. 'It does end up a lot of times in an M&A transaction if there is no succession plan.' The hardest parts that too few talk about Asked what founders need to prepare for, both panelists were unequivocal: The due diligence process is brutal. 'For many [founders], due diligence ends up being a second job,' Grant said, adding: 'You also have to keep running the business, and you want to run it in a way that performance does not drop, because that's the worst thing that can happen when you're going through a deal.' That's why both she and Klayman emphasized the need to 'get your house in order' — and do so early. From knowing who owns the IP to having clean cap tables and documented promises of equity shares, small oversights can kill a deal late in the game. 'I have actually seen one deal die because the whole company was built on this one piece of software, and that's what the buyer wanted,' Klayman said. 'And it was like, a software developer did it 25 years earlier, and they didn't paper it because it wasn't that important. And the deal just died.' She advised founders to use tools like Carta or diligence-prep software to identify red flags before a transaction is even on the table. Attorneys can help, but so can platforms that flag missing consents or unsigned option grants. 'Being organized is like 95% of the battle,' Klayman said. The stories behind the headlines Of course, learning these details can be difficult when many companies don't discuss them soon after an M&A takes place. The panel also pulled back the curtain on how mergers and acquisitions are framed in public — and how different the internal reality can be. Grant, whose company profiles founder-led exits, said PR statements often overhype vague synergies and downplay job losses or underwhelming returns. She added that sellers are often far more candid a year or two post-sale. 'Most of the stories we write, they're usually at least six months after the acquisition has taken place,' Grant said. 'The seller is more open to sharing real details at that point.' Klayman agreed: Sometimes the announcements make it seem like someone got a bunch of money, when usually the investors, even if they're paid first, 'are getting like 10 cents on the dollar,' she said. 'I don't think that people want those types of transactions to happen,' she said, 'but when they do happen, it takes effort and, I think, actually responsible founders to make it happen.' All emphasized that outcomes must be evaluated in context. Founders may sell to give their team stability, find a new role or offload a company responsibly instead of shutting down. What matters, they said, is alignment between a founder's goals and their investors' expectations. The closing message to founders was clear: Plan for your endgame from the beginning. Think through potential paths — and not just the flashy ones. Ask investors what their expectations are. Build a network that includes not just mentors and peers, but service providers who understand exits and won't charge you just to ask questions. 'If you don't know what success looks like, you're going to be poor no matter what,' Ravenscroft said, 'because you won't know it if you get it.'
Yahoo
29-05-2025
- General
- Yahoo
Maryland's universities ‘carefully monitoring' federal actions on international students
It's too early to tell how federal changes to student visas will affect colleges and universities statewide as Maryland's higher education community continues monitoring the latest actions taken by the State Department targeting international students this week. The State Department temporarily paused scheduling student visa interviews, The Associated Press reported Tuesday. The department is planning on expanding social media screening and vetting, an internal document reviewed by the AP said. On top of the interview pause, Secretary of State Marco Rubio announced Wednesday that the State Department and Department of Homeland Security will work 'to aggressively revoke visas for Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields.' In the 2023-2024 school year, India was the top country of origin for international students nationwide with 331,602 students, followed by China with 277,398, according to data from the State Department-sponsored website Open Doors. Baltimore's Johns Hopkins University was one of the leading host schools for international students in the country, Open Doors' data shows. About 27% of Hopkins' student body, including undergraduate and graduate students, are international, a Hopkins spokesperson said Wednesday. Hopkins did not comment further by deadline Thursday. International students are not only going to large research universities like Johns Hopkins, however. Thirteen percent of the student body of Annapolis liberal arts school St. John's College is made up of international students, according to Sara Luell, a college spokesperson. 'We continue to monitor the ongoing situation and are working closely with our students to support them and minimize impacts,' Luell wrote in an email Thursday. Towson liberal arts school Goucher College's international students come from 40 countries and make up 7% of the school's undergraduates, it said in a statement Wednesday. The school said it 'remains fully committed to global education.' 'We value the perspectives our international students bring to campus and the positive impact they have on our entire community's learning experience,' the statement reads. 'We continue to monitor this issue and how it will impact our current students, incoming students, and exchange student populations.' Meanwhile, in public higher education, over 10,000 international students were enrolled across the University System of Maryland as of fall 2024, the system's data shows. 'We are carefully monitoring the State Department's decision to revoke visas for some international students and pause visas for others,' wrote Michael Sandler, a spokesperson for the University System of Maryland, in an emailed statement Thursday. 'We are very concerned for the welfare of all international students, as well as their ability to learn and study in the U.S. and make contributions to our broader academic communities. We continue to support our international community as we evaluate the impact these decisions have on our campuses.' A State Department spokesperson said Wednesday that it does not comment on internal communications but said the department has required applicants to give their social media handles on visa application forms since 2019. All visa applicants are continuously vetted, the spokesperson said, from the time they apply, through the visa adjudication process and then during the issued visa's validity term. The department referred The Baltimore Sun to its Thursday media briefing when asked about Rubio's statement on Chinese students. State Department spokesperson Tammy Bruce did not specify what particular areas of study the 'critical fields' Rubio referenced were during the briefing, saying the phrase, while specific, 'could mean many things.' 'The United States … will not tolerate the CCP's exploitation of U.S. universities or theft of U.S. research, intellectual property or technologies to grow its military power, conduct intelligence collection, or repress voices of opposition,' Bruce said. 'Every visa adjudication is a national security decision,' she said. Bruce also confirmed that the reported details of Tuesday's leaked internal document were accurate. These are the latest federal actions targeting international students in recent months. Some international students at Hopkins, University of Maryland, College Park and University of Maryland, Baltimore County had their visas revoked — and then later reinstated — last month. The Trump administration recently barred Harvard University from enrolling international students, who make up a quarter of the school's student population. A federal judge blocked the order last week. Have a news tip? Contact Racquel Bazos at rbazos@ 443-813-0770 or on X as @rzbworks.
CBS News
20-05-2025
- Business
- CBS News
University System of Maryland authorizes furloughs, salary cuts amid funding shortfall
University System of Maryland votes to allow furloughs, salary reductions to deal with budget cuts University System of Maryland votes to allow furloughs, salary reductions to deal with budget cuts University System of Maryland votes to allow furloughs, salary reductions to deal with budget cuts The University System of Maryland Board of Regents voted Monday to authorize potential furloughs and temporary salary reductions for university employees as the system grapples with significant funding cuts, according to the Baltimore Banner. Monday's vote doesn't mandate that all 12 universities in the system implement these measures but allows them to pursue these options while facing a 7% state budget cut and the loss of millions in federal grants. Maryland universities struggle with reductions in federal funding Maryland has cut over $150 million in funding to the state's public university system, and the Trump administration has also canceled hundreds of millions of dollars in federal grants to Maryland institutions. Just last week, the University of Maryland, Baltimore said it was laying off staff and eliminating some vacant positions. UMB said "Modest salary reductions" would affect about 1,000 employees, including university leadership, primarily at the medical school. More than 40 research grants and contracts, totaling about $12 million, were canceled due to federal funding cuts, specifically attributed to efforts by the Trump administration to eliminate diversity, equity, and inclusion (DEI) programs. JHU reported layoffs of 2,200 workers following a loss of funding from USAID and new caps on indirect research costs by NIH. In April, JHU said it would use endowment earnings to offset some of the impact from major federal research funding cuts What the vote means The vote allows institutional closures to help save money, but schools must continue with "essential services," like class schedules, critical student services and, in relevant cases, patient care, according to the Banner. Plans to furlough employees or reduce salaries "may allow for exclusion of certain individuals," according to the document, though no further specifics were included. Any temporary salary reductions must be reversed by June 30, 2026.
CBS News
17-03-2025
- Business
- CBS News
Maryland students, education advocates raise concerns about proposed 2026 budget cuts
Maryland students and education advocates are expected to hold a rally Monday evening in opposition to potential cuts in the 2026 proposed budget. The rally in Annapolis is being held on Crossover Day, known as one of the busiest days of the legislative session. Rally organizers say Gov. Wes Moore's proposed budget includes cuts to education that would strip essential resources from schools and disproportionately impact students with the highest needs. Gov. Moore's proposed budget aims to address a $2.7 billion deficit through spending cuts and tax increases for residents who earn more than $500,000 annually. The budget would also increase taxes for sports betting and recreational cannabis, and would add a surcharge on deliveries from companies that make more than $500,000 per year. During an interview in January , shortly after the proposed budget was introduced, Gov. Moore told WJZ the $2 billion in cuts will impact programs that are determined to be ineffective. "There are certain programs that, as we looked at and really did deep dives, I question their efficacy," Gov. Moore said. "So you'll see certain programs, for example, certain tax credits, the enterprise tax credit is one. There's no evidence of efficacy that we have seen." The governor also said there would be cuts to education programs that do not impact the state's Blueprint initiative and cuts to higher education spending. Gov. Moore's proposed budget would cut $111 million from the University System of Maryland . The higher education system would get $2.21 billion in state funding, under the 2026 budget, down from $2.32 billion in 2025. The system is comprised of 12 institutions and three regional centers. Gov. Moore predicts that tuition rates will increase by a projected 2.2% in 2026. Under the proposed budget, local community colleges would receive $63.2 million. The University of Maryland, Baltimore would receive $42.9 million for construction, and Towson University would receive $71.1 million for construction. Morgan State University would get $119.2 million for construction and other upgrades. The budget also includes $8 million for projects at three private institutions.
