776: Assessing Risks Beyond the Numbers | Nipun Soni, CFO, BillionToONe

When Nipun Soni tells us that he spent 5 years at Oracle Corp., during which time he helped to perform due diligence on some 40-plus M&A transactions, we can’t resist asking about the “big” deals that grabbed business headlines—such as Oracle’s 2009 acquisition of Sun Microsystems, Inc. Although Soni no doubt understands our curiosity, he can’t help but tamp down our expectations a bit after we ask: “Do you recall ‘the visit’ to Sun’s campus?” His reply? “With high-profile public company mergers, you actually don’t visit. You try to keep it under the covers. You don’t want people to know about it before it happens.” Still, our curiosity lingers around “the visit” because this is when the ice is broken and where finance is frequently represented more than any other functional group within the acquiring company. Soni is happy to expand: “Well, as soon as the transaction was announced, we were actually at the Sun campuses. We met with Sun’s broader team, their leadership, and we tried to break the ice between the two broader finance teams just by saying: ‘Hey, welcome to our broad Oracle umbrella. We really look forward to working together and learning about this different business model.’” However, BillionToOne’s CFO makes it clear that some of the biggest lessons from his 40-plus M&A transactions at Oracle and numerous subsequent other ones that today populate his collective career portfolio often came from deals involving smaller private companies. “You don’t want to suddenly find yourself in a position where you inherit a few questionable sales transactions from an acquired company that begin tainting the overall revenue recognition of a company like Oracle,” explains Soni, who adds that the lack of infrastructure within smaller firms often makes such transactions riskier—and all the more interesting. "What is it that we should be looking for?,” “How do we evaluate the synergies between the two companies?,” and “What are some of the beyond-the-numbers risks that must be thought through?” asks Soni, as he seeks to better expose the experience he believes helped to propel him upward in his career and ultimately into the CFO office at BillionToOne. - Jack Sweeney