Acqui-hiring: Concept, Benefits and Steps

What is Acqui-hiring?

Acqui-hiring is a combination of two words: “acquisition”, and “hiring”. Acqui-hiring is a term in HR management, which means acquiring or buying a company just to hire its employees. This acquisition is made to attract highly skilled and talented employees of the company rather than its products and services. It’s very common in the tech industry because of the high demand for skilled employees and the lower supply. It’s very beneficial because, due to Acqui-hiring, the company doesn’t need to spend much time on the lengthy process of hiring employees one by one. They will get a bunch of talent pools in one go.

Benefits of Acqui-hiring

1. Rapid Talent Acquisition: The traditional method of hiring employees is very time-consuming, as it includes, multiple steps, like selecting candidates, screening, interviewing, training, etc. But in Acqui-hiring, the company can quickly onboard a team where everyone is an experienced and skilled professional. In this fast-paced world, speed is very crucial. In this process, the company acquires the whole company, and then they will get all their engineers, designers, managers, etc. So the whole team can continue their work as they were doing before the acquisition.

2. Provides an easy exit for a startup that’s struggling financially: Acqui-hiring provides a win-win situation for both companies: the big company that has been acquired and the small company that is being acquired. This is because the bigger company will have an ideal working team that can directly start working. They need not make an effort to find employees. The small company will get fair compensation, which can create financial stability and a chance to join a bigger company.

3. Enhances organisational efficiency: This will enhance the efficiency in working of the company as the company has hired newer employees instead of Acqui-hiring, then they won’t have a strong relationship with colleagues, which they will get in case of acqui-hiring because all employees previously know each other. They are clear about their roles, which will reduce conflicts and misunderstandings. They will adapt quickly and integrate with other employees of the company.

4. Enhanced Market Reputation and Valuation: When the investors get the signal that your company is continuously investing in hiring and improving, it will boost the confidence of your investors. This can open the door for more valuable investors. Also, a high-performing team will enhance the quality of products and make you stand out in the market. This will improve the reputation of the company in the market.

5. Knowledge Transfer Programs: The employees hired from the acquired hiring may have expertise in different fields, skills, etc. It will form a combined knowledgeable and skilled team. As employees share their skills and tricks with each other, it’s like a big knowledge exchange when the experienced employees from the acquired team teach and share their cool methods and insights with the people already working at the acquiring company. This will help the whole organization to learn faster and work together better.

Steps to Acqui-Hiring

Step 1. Identify your talent needs and goals

The first step for Acqui-hiring is to determine what kind of talent and skills you are looking for and why. You should be very clear about the needs, challenges, and expectations and how will you achieve them with the help of Acqui-hiring. In order to understand the need, the company needs to identify the gaps and challenges the company is facing. Critical roles are essential for success, which they are missing. Also, they should discuss this with their employees and stakeholders.

Step 2. Research about potential target companies

The second step is to find a company that could help in achieving the company’s goals. Fill the critical gaps of employees. You should look for companies in various online databases, industry reports, social media, referrals, networking events, hackathons, etc. When deciding on the company you should look at the size, stage, and financial situation of the target companies, and how they match with your budget and expectations.

Step 3. Approach and engage with the target company

The third step is to approach the target company with a personalized pitch. You should tell them the benefits and opportunities they will get after joining your company. Be clear about the goals and expectations after acquiring the company. The main purpose is to build trust with the company and clear any concerns they have. Respect their privacy and confidentiality.

Step 4. Negotiate and finalize the deal

This fourth step is about purchasing the company. For that, you can seek the help of a legal consultant. So you have knowledge about all the policies related to this purchase. Negotiate to a price where both parties mutually agree. Then get approval from the board of directors and stakeholders of that organization. Get consent from the employees and offer them a good salary and compensation for their retention. After this, you can sign the formality documents, make the payment and complete this transfer of ownership.

Step 5. Integrate and retain the new talent

Now after acquiring the company, the final step is to integrate the new talent in a combined form. You should have a clear plan like, in which role each person will work, whether would they have the same positions which they had before, where they work, and which projects and resources should be assigned to them. You should also, organize collaboration workshops and parties. So that everyone can understand each other. Also, reward and appreciate them for their achievements. Monitor and measure their performance. Solve their challenges and concerns if they arise.

Conclusion

Hence, we understand that Acqui-hiring is a strategy which includes buying the whole company to get access to talented employees of the company. It can have various benefits for the company, such as increased productivity, performance, and knowledge transfer between new and old employees. The process of Acqui-hiring begins with choosing a company which is suitable according to financial status, work balance, performance, etc., and then acquiring it with the consent of employees, and chairpersons. Then, deploying the new employees in their respective roles. It requires careful planning and negotiation. People should not consider it as a shortcut to success. Managing a company with a lot of employees, retention, and continuous improvement is equally difficult to build from scratch. Acqui-hiring can benefit both the buyer and the acquired organization if done right.