The Current State of Mergers and Acquisitions (2024)

Today the news broke that the Dutch company Goliath has acquired one of the bigger tabletop game companies, Lucky Duck Games. It may seem acquisitions like this come out of the blue, but in reality they’re extended processes that take months or even years with significant resources poured into legal, accounting, and operations.

There are also partial acquisitions like when CMON bought the brands Hel and Anastyr from Mythic Games a few months ago. There’s also an even more partial share-based acquisition (Stonemaier Games, for example, is a US-based S-corp with 1000 shares owned by around 25 people who have bought those shares over the last 7 years). Mergers also happen when two similarly sized companies consolidate resources into a single brand.

If you are a creator, publisher, or business owner and you think you might be interested in any type of acquisition in the future, I’ve updated the list of questions (below) to ask yourself if you’re considering an acquisition offer. I also recommend implementing the following:

• Ensure there is “consent to assignment” text in your contract templates. The basic idea is that your contracts can smoothly be assigned to another company in the event of an acquisition. Without this text in place, you have to track down every artist, designer, partner, etc who has signed a contract and ask them to sign a consent to assignment; if they don’t sign, the buyer will have valid concerns about the intellectual property.
• Implement a polished, professional financial documentation and accounting process. The acquistion process requires a massive amount of financial documentation. Part of it is running P&L reports and balance sheets (for which we use a combination of Anders Accounting and Timely Totals bookkeeping), but it also involves digging into revenue per brand, per product, and per vendor/platform based on various timeframes.

It was these recent events that made me revisit my previous post on this topic and this earlier post. I’ll skip over the sections that feature questions for the buyer and previously acquired companies, as they remain unchanged. My updates are to the following section:

Questions for Yourself

1. Are you happy with the way things are? Just because a company is interested in buying Stonemaier Games–even at a fair price–doesn’t mean it’s a good fit. There’s always plenty of room for improvement, but like me, you may be very happy with the current state of your company.
2. Is the acquiring company offering assets (beyond financial) that will make your life and your company better? This is a question I struggle with, because all of the assets I need for Stonemaier Games to function are already in place. Will the buyer’s capabilities augment or impede what you do so well already, especially considering the added friction and bureacracy present in large corporations?
3. Will the deal let me do more of what brings me joy with no regrets? An acquisition offer is both a good opportunity to consider what you enjoy the most about your job and what the acquiring investor values in you (i.e., what they hope you will continue doing for years to come).
4. How much of a say do you have in the decision? Another way to look at this is, “Do I owe it to my investors to consider this deal?”
5. Do you mind answering to someone else? I answer to other people all the time! :) The one thing that concerns me is having poor leadership–I’ve had bad bosses that impacted my ability to manage projects and people, and I don’t want that to happen again. However, if their leadership has similar philosophies and principles, this may not be an issue. There’s also the chance that the person you connect with won’t always be there.
6. How secure do you feel about your future? The future is just as risky as it is exciting. If you receive an offer today, there is a certainty in it that can’t be matched by an unknown future. That alone isn’t a reason to accept an offer, but it’s certainly a factor to consider.
7. How much control do you want? In particular, do you like the pace at which you produce content? We publish 1-2 new games each year and a few complementary products (while reprinting and supporting older content), a pace that allows us to shine a big spotlight on each of our products for a prolonged period.
8. Does this deal protect the products and people I care about? This extends to my customers, employees, independent contractors, partners (distributors, international publishers, manufacturers), etc. There are people whose entire business (or a significant portion of it) is tied to Stonemaier Games or one of our brands. I feel a moral obligation to these people.
9. How much is your company worth? This is a tough one to answer because a company is only worth what someone else is willing to pay for it. There is no standard valuation formula that applies to every company or every industry. The acquisition process could give you a clearer view of how investors perceive the value of your company.
10. What’s the minimum offer you would consider? What are your dealbreakers? I think it’s worth figuring out these answers early on in negotiations so you don’t waste the investor’s time and they don’t waste yours.
11. How much time and how many resources am I willing to spend on the acquisition process? The entire process requires an immense amount of time, money, and paperwork and will probably require at least 6-12 months. Is that a burden you’re willing to bear while also continuing to move your company forward every day?
12. Do you want to continue to run your company, or are you ready to focus on something else? Acquisitions typically either focus on the people, the intellectual property, or both. In the Goliath deal, it’s reported that Lucky Duck founder Vincent Vergonjeanne “and his management team will continue to run Lucky Duck Games autonomously as an independent studio within the Goliath group of companies.”
13. If you continue to run your company, what types of changes to your routine are you worried about? Do you work from home or from your office, and would that change if your company is owned by someone else? Do you enjoy frequent meetings where you’re reporting key performance indicators (KPIs) to people who are expecting the numbers to always go up?
14. How will your existing fans perceive the acquisition? I’ve had a few people tell me, “I sure hope you don’t sell out.” The way people perceive you and your company can change based on if you’re acquired and who acquires you.
15. What happens if things don’t work out? Despite all the conversations and due diligence, there’s the possibility that the acquistion just may not work out (either at the end of the process or even a few years after the acquisition is complete). It’s good to have conditional exit clauses that are respectful to both parties.

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Where does Stonemaier Games fall into all this? I mention above that we have shareholders (individual US citizens–per S-corp laws–who have bought Stonemaier shares from other shareholders) who receive semi-annual distributions and provide input to steer the company. We once sold one of our intellectual properties (our realistic resource line) to Top Shelf Gamer. Beyond that, while we have entertained larger offers from potential buyers–always with the contingency that we remain autonomous and independent–none of them have born final fruit.

In retrospect, I’m glad that’s the case. I love that we have the complete freedom to serve you and try to bring joy to your tabletop without layers of bureacracy or KPI expectations. I just want to make awesome stuff for you, and I’m grateful for the opportunity to do so as an independent publisher.

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Have you ever been approached about a partial or full acquisition? What are some additional questions you think are worth asking? And when a company is acquired in an industry you follow, how does your perception of them change?

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