Finding the right fit: A Microsoft partner CEO shares his acquisition experience in the channel

For decades, the Microsoft channel has attracted entrepreneurs and technologists intent on serving business clients. As these partner organizations grow, their focus evolves along with the market and Microsoft's priorities. And as time passes, leaders of these firms shift their own plans and goals.

Andy Neal, CEO of Phoenix-based Microsoft partner NEALABC, recently celebrated the acquisition of his company by another channel firm, Heartland Business Systems. He shared details of his experience in the sale process for other partners who may be considering an exit.

Navigating a partner-to-partner acquisition

The origins of NEALABC stretch back to 2003, when Neal and his father teamed up to provide sales training, planning methodologies, and support for major CRMs like Microsoft Dynamics, SugarCRM, SalesLogix, and Salesforce. Along the way, the two entrepreneurs decided to focus on Dynamics. He explained:

Our bread and butter is Dynamics, particularly CE, Field Service, Business Central, Power Apps, and Power Apps Portals, always with a heavy business consulting acumen. We help clients select software and get ROI from their tech spend and make real changes in their organization.

A few years ago, Neal’s father retired and his brother joined the company. Around the same time, the company began to receive cold calls and emails about being acquired.

Some of the [early] offers seemed to want to assimilate us like the Borg, into their model. They were not as receptive to collaborating in a way that would make sense for everyone involved and integrate long term to get 1+1 equals 2.5 rather than -1, which happens in a lot of M&A. I felt the culture was the right fit—number one deciding factor.

Neal initially rebuffed most offers but began to become more interested as more potentially qualified buyers reached out that expressed a vision that matched his own.

[Deciding on a buyer] was really about cultural fit. With the type of merger we were going to do, me being the owner, I wanted to continue to work, contribute, and be involved in a team. We really wanted to merge with someone to help us put gas on the fire. They weren’t looking to stifle our creativity, but to augment and truly collaborate. They saw value in what we had.

When he reached an agreement with Heartland Business Services, Neal said the execution of the deal moved quite quickly but quietly.