General Catalyst's deal structure: 60-70% cash, founder keeps 30% equity to ensure smooth handoffs
When General Catalyst companies acquire a business, the structure typically involves paying about 60 to 70% of the purchase price in cash, while the founder rolls roughly 30% of their equity into the new combined company. The logic is straightforward: someone who spent 20 or 30 years building client relationships has a real financial reason to stay and make the transition go well. A failed handoff is one of the biggest risks in any acquisition, and this structure directly addresses it.
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