Another viable 'exit strategy' for a startup is a merger or acquisition. Not just a graceful exit, oftentimes an acquisition may be the best path for an entrepreneur to achieve his or her mission. Almost out of money, Donna Dubinsky and Jeff Hawkins of Palm discuss selling their company.

Relevant Texbook Chapters Chapter 14 Acquisitions, Mergers and Global Business
Discussion Questions 1. What was Jeff and Donna's mission in starting Palm? Have they achieved it in this case? 2. What experiences have they had with partners that color their receptivity to Zakin's offer? 3. What impressions do they have of US Robotics and why? 4. What are the top three reasons Donna and Jeff should reject US Robotic's offer and go it alone? 5. Imagine you are an entrepreneur with a relatively successful technology start-up. Several companies are interested in acquiring your company. How would you decide whether to be acquired or not? How would you decide which one to sell to?
Main Case Study: Palm Computing, Inc. - 1995 Financing Challenges Donna Dubinsky and Jeff Hawkins, discuss an opportunity to sell their company to U.S. Robotics. They must weigh this option versus accepting venture capital funding, partnering with a large company that could provide distribution channels and capital, or continuing a search for capital from other sources.
Carol Bartz: Spinoffs - the concept behind buzzsaw.com In 1999, Autodesk spun out a company called Buzzsaw.com. The concept was to provide a hosted environment for the construction industry. The problem: There are many people who come together one time for a project--architects, engineers, construction managers, contractors...that combination of people makes a building. They interact infrequently, but their collaboration is essential to the success of the building. This clip discusses Buzzsaw as a spinoff--how the opportunity was recognized, and realized, and the lessons learned.
Heidi Roizen: Venture capital vs. corporate funding Why VC funding over corporate investors? Or the other way around? Vc's give you money and sometimes in the future they want to get a lot more of it back. When taking money from a corporate investors they generally want early view into technology, sweet deals from business development perspective. If taking money from corporate investors, make sure you know what they want and what you want.