YouSaid · the spoken record

James Loftus

lines on the record
27
first
2018-03-26
most recent
2018-03-26
sittings or episodes
1
sources
podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

  1. “So strangely enough, my most recent deal was an investment, not an acquisition. We made an investment in Eventbrite and we signed a significant commercial deal with them. The reason we said yes was we think that the partnership opportunity, both for us and Eventbrite on combining payments with their ticketing platform is really, really exciting. And on the investment side, it was a no-brainer. Eventbrite's a fabulous company, great executives, great space, great growth. And so we're really, really excited to be able to be part of their team now.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “The most difficult thing for me always is just sort of prioritizing what we need to do among so many interesting and exciting challenges. Square is just doing so many things. And so sort of looking through all that and looking through all the opportunities in front of us, like how do we focus with limited resources on the right idea or the right process?”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “I love Julian Barnes, and my favorite Julian Barnes book is a history of the world in 10 and a half chapters. I tend to try and mix in as much fiction as I can with all the business books I like to read, mostly because for what I do, it's really important to be able to understand other people's point of view. And I think reading fiction is a great way to do that. And I think Julian Barnes is my favorite at sort of exposing how one situation can have 10 different mirrors on it if you look at 10 different points of view.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Sure. I think the most important thing is that Corp Dev wants to be your advocate within the company, not just for an M&A deal. We spent our days talking to VCs and talking to startups, and we've self-selected for this job because we love entrepreneurs and we love the entrepreneurial activity that Silicon Valley represents. And so don't be afraid to engage with us, even if you're not interested in selling the company. But if you want an introduction to someone at Square, if you want to talk to our business development team, if you think that there's a product manager that you could spend an hour with and both of you could get smarter, that's what we love to do. We love to bring in that outside entrepreneurial spirit into Square, and we're happy to bring some of our at scale working knowledge to startups as well. It's not just about buying or selling companies. It's really about being engaged in the ecosystem generally.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “I think the thing that I do know now that I wish I had known was how emotional the MNA process is for founders and CEOs, especially founders. When I came from New York, when I was a lawyer, the M&A process in big corporate America is not an emotional exercise. Any emotion is really sort of manufactured as part of negotiation. People storm out of conference rooms and things all the time, but it's not revealed. Whereas that's a fundamentally different in Silicon Valley or in tech M&A generally, where you're dealing with a founder who may not have paid themselves has worked 100 hours a week for the last four years. You need to be very, very cognizant of that fact across all parts of the engagement process. I became very aware of it in my time at Adriason, and I'd really try to keep that in mind and make sure that members of my team keep that in mind when they're engaging with founders. This is not just a company. It's not just a business deal. It's much, much more than that to those folks.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Let's add that to what's successful in the same way that sometimes there's unexpected risks that come up and we look at those too. I think the important thing is to have a systematic check back, especially if you're doing a significant amount of M&A, to say somewhere between two and four times a year we're all sitting down and we're going over the metrics on outcome for each deal and deciding whether it was a success. And if it wasn't, how can we fix that to make sure that we address that in the future?”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Sure. It's a little different across all different types of deals, but what we try and do is we try and keep ourselves honest and tie success back to our original deal memo. And so we go into every deal with a thesis and the thesis could be we want more talent. The thesis could be this piece of technology is really important or the thesis could be this adds to Square's financial metrics. What we try and do is when we look back at those deals, we try to do so on a regular basis is if it was a talent deal, are the people still here? Are they contributing? Are they an important part of Square? If it was a technology deal, are we using the technology in the way we expect it to? Did it accelerate the roadmap? Did it give us the functionality we expect it to? And if it's sort of a whole company deal or financially driven, then we're measuring it against a model that we put together at the time of the deal and looking at it and saying, you know, are the financial results what we expected them to be? I think there's a fourth bucket, which is sometimes there's unexpected benefits from deals. And like we were not afraid to sort of say, we didn't see that coming, but that's a wonderful outcome.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “I think that we have across all of the decision making of Square a really collaborative and open discussion. And so I think what's important for us is that we have an opportunity for all of our executives to weigh in and give us really good input on these deals. And that's sort of what adjusts our process.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “In a definitive agreements, and we'll check back in with our executives one more time before we sign a binary agreement and close. By and large, and this isn't necessarily true for Square, but across Silicon Valley, once that term sheet is signed, that's a pretty high outcome rate. I wouldn't want to guess a percentage, but those deals usually close. But before you have a term sheet, before you have something signed and written, that's when you're probably still below 50% on likelihood of outcome.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Sure, this is true for Square, but it's true at Yahoo and it's true at Google too. The first check is always that there's buy-in from sort of product champion. And so that is the first thing we always do. And that's part of, I think, the process of talking to the product teams and collecting information. But when we find a target that's interesting, the very first thing we need is someone who's passionate about it at the company because Corp Dev doesn't do deals, product does. And so that's the first thing we need. I think the next step then is usually to do some level of work, understand the company more so that we can pull together a deal memo. And then we talk to our executives about it. Both of Yahoo and at Square, I've tried to make sure that we pull that executive conversation up very early in the process before we issue a written offer so that we make sure that we don't have too many places down the line where Square has to change its mind, basically. And so we have that fulsome conversation with our executives before we issue a written term sheet. And so after that, once we issue a written term sheet, we'll negotiate the term sheet.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Actual likelihood of a deal is, and depending on where you are in the process, that likelihood obviously gets higher and higher as you move further down the process. But I think that you have to really think hard about that. And I know it's super hard for founders because especially in smaller companies, like transparent organizations are the norm. And so I think that that can be a challenge to the culture of the company to say we're going to keep this amongst maybe the two or three people for a while.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “So, I think how you behave and how you conduct yourselves, I'll take first, which is I think you have to build a trusting relationship with somebody on the other side. Maybe it's a corporate development person. Maybe it's the product person who's leading the deal, but you need to have someone that you have a very open, very frank line of communication about. So if you are overwhelmed, if you feel like it's grueling that you can express that and you can start to get the process adjusted, because nine times out of 10, the acquirer doesn't know that they're sort of crushing you unless you raise your hand. I think the second question about how to communicate to your team, I think that's a really challenging one because the one thing I'll say is deals aren't done till they're done. And so you have to be careful about how far along a deal is in its process before you unhook your team from their everyday work because you will. If you tell them that you're in an acquisition talks and that they're serious, work will stop. And so you need to be very careful about that and balance wanting to be frank and honest with your employees with what you think the”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “And so it can be pretty overwhelming. I think my job as the corporate development lead on the deal is to make sure that I manage that fire hose in a way that it doesn't completely overwhelm the company, but still moves us quickly towards the end of the process. Because if it's going to be grueling, it might as well be fast, grueling and slow sounds awful, right? So I try and at least make sure that we can move through the process quickly and we get what we need but not more and that we sort of are respectful of how much more firepower we bring to the table than a startup's going to be able to.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “So, that is somewhere where I try and be upfront with founders that it can be difficult. It's not necessarily easy, but it's not intentionally difficult. It's not designed as a meat grinder to sort of grind down the will of startups. I think the reality is that an acquisition is a big deal, even small acquisitions is a big deal for any company. So when you're bringing a company in, there's a lot that you need to know about what you're bringing in, both from a risk allocation and risk management piece, but also from mostly from an integration piece. How do you make sure that when the company is brought into the acquirer, do you have a real chance for success? But as a result, there will be a lot more people on my side of the table than on your side of the table as a bounder. And that just that by itself, I think, is what creates that sort of quote-unquote grueling environment that Paul is talking about because I'm going to roll out, even at a small company like Square, somewhere between six and 10 people who are going to be involved in the deal process. And they're all going to be asking the CEO founder for stuff.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “So, I mean, I think there's an eye level where I love to spend time and talk to the venture capital community, not necessarily to go and be like, what part of your portfolio can I buy, but more just because what I saw at Andreessen is that you really are seeing the pulse and flow of what is coming and what the trends are. And so for me, it's absolutely invaluable to have like a good back and forth relationship with VCs on what are they seeing, what's interesting, what's real, what's not real. And I think that that is the first level of value. And I'd like to think that I can give the point of view of a large corporate and sort of what we're seeing in the marketplace and what we think is going to make it up to our size. And I think that there's a great.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “I think the best VCs, especially in the M&A process, can act both as a balancing and a calming factor for founders. It's an incredibly difficult and challenging task for a founder to sell their company, whether it's big or small, there's just a lot going on. It's an emotional time period. And I think that your best investors can come along and provide you not just great advice, but just a steadying hand that everything's going fine and give founders a backup because by and large, founders don't have a ton of experience with M&A. VCs will, especially VCs who sort of boards will have seen this a lot more. I think the challenging part that can come with VCs sometimes is they need to recognize the limits of their experience as well. The only times I've ever run into trouble with investors is when they, based on a small sample size of M&A deals, are providing founders with advice that can be, I think, sometimes counter to their interests. But to be honest, that happens pretty rarely.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “So we approach it from two different ways at Square. I think the first thing we do is we narrow the lens by really digging in and spending a lot of time with our product teams and understanding what's important to them, what's on their roadmap, where we think we can help accelerate that. And that helps us narrow the lens a little bit to say, all right, like we've talked to this team and it's not everything they're doing. It's a couple of spaces within what they're doing. And then we can take that and bring it out into the marketplace. And so that's sort of what I would call the bottoms up approach to how we narrow things down. And then I think there's a tops down approach, which is to make sure that we're keeping an eye on and evaluating new business opportunities for Square. And that's a little more freeform. I think we spend a lot of time talking to venture capital firms who spend a lot of time talking to influential founders. We spend a lot of time reading blogs and news and just trying to understand what the trends are, what the forces are that affect Square. And so that we can identify and see”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “Of startups that could be interesting to us is massive. It runs the gamut from payments all the way through lending and consumer finance. And so we're always overwhelmed. Every Corp Dev team is always overwhelmed by the number of startups that there are out there. And so it behooves you as a founder or CEO of a tech company to build those relationships, to get yourself on the radar of the teams that matter to you, and whether it results in an acquisition or whether it results in a partnership or even whether it just results in some mixing and sharing of ideas between the two companies, I think it's really valuable for those tech companies to build that relationship and engage with corporate development. And I think that's where I disagree a little bit with Paul's advice.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “I think Paul is a very, very smart guy. And I think that his advice in the article is much more nuanced than the title of his article. And so I would say first, I disagree with the premise that the title of the blog post gives, which is that you should never talk to corporate development. I think the second premise, which is you shouldn't do that because you should be focused on building your company, is a great sentiment. And so I think the balance that companies have to find in between those two factors is back to my previous statement about companies being bought and not sold, is that building a relationship with companies that may someday be a potential acquirer is a really important part of making that option a reality. Corporate development teams across Silicon Valley, including at Facebook and Google, are small compared to the opportunity set that they're evaluating. There's just so many companies out there all the time to evaluate. And if you're even at Square, we have a broad set of product lines, and that means that the universe”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “Because, in my view, even though you've seen new entrants into the market, there's been softening at the other end of the market from the Google, Facebook, Apple, Amazon end.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “So, I think that pricing tech companies in particular is incredibly difficult, especially I've spent most of my career in consumer internet. You're buying a lot of companies where you're looking at talent and technology are the main drivers. And so you can't sort of build a model directly related to the company's existing revenue or profit and be 100% sure on price. I haven't personally noticed prices going up. The factors I just discussed are certainly factors with new entrants in the market and driving price up. One factor that I think has moderated prices a little bit is that M&A has become the absolute primary method of exit. You've seen far fewer IPOs over the last five years. And given that that reduced itself as an option, an IPO is often your primary competition when you're doing an M&A deal, especially for a significant and large company. The company will be looking at an IPO as the option to an M&A deal. And that's when pricing becomes difficult because you're sort of competing with the public markets. So I haven't seen a ton of pricing increase, but I do think that's.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “So, I think there's a couple factors going into that. First of all, I think it's hard to tell because there's obviously those numbers that you just quoted, but a lot of, especially the big tech acquirers are pretty secretive about the M&A they do. And they're so big now that they don't have to break out their acquisitions and their public filings. So you could go a year or two sometimes without seeing all the deals that a Google or Facebook or an Apple's done. But that said, I do think there's a couple of factors going on. So I think I agree with Emily in one sense, which is that it does feel like the large tech acquirer sort of the big five have at least slowed down the pace, like a number of acquisitions they're doing. Obviously, you have Amazon doing something giant like Whole Foods, but it feels like the deals that are sort of the bread and butter of the mid-level exit, I would call. So sort of like things under $200 million. It feels like those companies are doing fewer of those deals. At least they're announcing fewer of them in any case. And those five companies drive a ton of the market. That said, I do feel like”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “Gives this view that's like, oh, just keep your head down, build a great product, and someday an acquirer will come knock you at your door. And I think that's a really, really rare occurrence. I just don't think things happen that way.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “Yeah, for sure. I hate that saying because I think it's a trite way of describing the M&A world. And I think it really ignores almost all of the nuance. And so let me dig in on that a little bit. So if you're Instagram, sure, you're bought not sold. So if you're a no-brainer for a company like Facebook or if you're a WhatsApp, I think Facebook's done quite a few deals where they came in and bought someone out just because they had so much success and they were so strong. And I think that's a fine piece of advice if that's the business you're sitting on. I think the reality is much more nuanced. I think if you look at the vast majority of M&A deals that happened out there, there was work done by the company, by the company's investors long before any acquisition even came into anyone's mind. And that work really is working on building the relationship with potential acquirers, building awareness in that community of acquirers of your company and what it does and what you might be able to do for a potential acquirer. And so I just think that”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “Rounded out my sort of view of the world. I then did what I think most Corp Dev people want to do, and I took a jump at going into a more operating focused role and went to work at a company called STX, which is a movie studio down in LA. It was heart of my family with all the travel, so I decided to sort of, as a lot of startup things do, it didn't work out for me. But the great thing for me is I then consulted for most of a year, doing the same thing I'd done in Adrien, but just getting more time, getting more embedded with some founders I had worked with at Andreessen. And after I'd done that for a year, Square came calling with an opportunity to come run their corporate development team. And when I looked at the opportunity that was in front of us at Square, just for the amount of runway we have for the really mission-driven culture starting at the top with an amazing CEO like Jack and really facing one of the more interesting times in any company can have where you're, you know, you have a lot of resources, you have scale, but you still are sort of small enough to maintain that mission-driven culture. I just left at it. It was just too good an opportunity to turn down. And I've been about this.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  26. “So I was there from 2010 to 2013. So just an incredible amount of M&A activity and just a huge experience in the tech world. But the one thing I did realize while I was doing that was that I enjoyed the business piece of the acquisition world a lot more than I did the legal part. And so I had an opportunity when one of the people I worked with a lot at Google was Marissa. And when she went to Yahoo to be the CEO at an opportunity to move over to the corporate development side at Yahoo. Another great experience of Yahoo, we did a bunch of deals in the two years I was there. I think did a lot of interesting things for the company. But then I had an opportunity then to go and work at Andreessen Horowitz on their operating team and their corporate development group. And it was such a great opportunity for me because I had done so much what I would call buy side M&A at Google and Yahoo that it was a great opportunity to go and work with both the venture capital firm and the founders to see what their viewpoint on the M&A sort of world was. It was a great experience. I think it really”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source

  27. “Sure. So I have a slightly different path to the Corp dev seat than a lot of my colleagues. I started my career as a lawyer. I was an M&A lawyer in New York for about six years. I worked on almost no tech deals, all banking deals and private equity deals, but it was a good experience for me. I was sort of pulled to the West Coast by a job offer at Google. And I went to Google and I was also a lawyer at Google, actually. It was an amazing period of time to work at Google. We did over 120 acquisitions in just over three years, and there were only four M&A lawyers.”

    2018-03-26 · The Twenty Minute VC · 20VC: How Great VCs Handle Themselves In An M&A Process, Why M&A Has Become The Primary Method of Exit & How The Best M&A Teams Operationalise Their Process with James Loftus, Corporate Development Lead @ Square · IDENTIFIED FROM THE TRANSCRIPT · source