This is a detailed view of our acquisition process. For more information about
our acquisitions approach visit our acquisitions handbook.
Acquisitions deal flow
Below is the deal flow of the acquisitions process with estimated conversion rates and metrics for each stage we think there can be a drop point. At this point, the estimates are hypothetical and not based on actual deal flow data we've collected through our process. The flow aims to capture the success rate and volume of the acquisitions process for GitLab.
Potential target companies
Deal term fit
Code screen share
Founders technical interview
Resume review of all people
Optional step: sample interviews with non-founders (will increase LOI success rate)
Deal terms discussed and socialized
Review all code
Interview all people
The process is comprised of three key stages:
Intro call: we'll reach out to schedule a 50 minute introductory call. The purpose of the call is to:
Current state of your company including team, products, financials, and more
Review the expectations and process noted on this page
Start discussing which features could be built into gitlab
Discuss which GitLab product category the team could join as a whole
Answer questions your team may have
Details from this call should be collected following the Initial Acquisition Review Template(a GitLab internal document).
TARGET TEAM: Ahead of the product call please review our roadmap and outline which of your current and future product features can be implemented into GitLab's product categories. Outline a simple integration timeline for those features, considering an MVC release on the first month after joining GitLab and monthly releases following with quick iterations.
Create a new, private Slack channel. Format: #acq-company_name. Add VP Product Strategy and the relevant product category director(s).
Add template WIP Business Case to the top of the acquisition gdoc and start filling the details
Product call/s: start product diligence and deep dive into the discussion of which features could be built into GitLab and into which GitLab product stage. Discuss strategy fit to GitLab's product roadmap.
Internal review: validate potential fit for the team within GitLab and the integration options into GitLab
Internal acquisition champion - every acquisition needs a champion; someone who is advocating for the acquisition, helping drive the acquisition rationale, and seeing its successful integration. For most acquisitions that fit our approach, the champion will come from GitLab's Product team, at the Director level. For other acquisitions, champions may come from engineering or possibly other functions.
Preliminary financial & legal diligence - list of preliminary documents to share with GitLab:
Employee roster with: employee name, title, role, tenure, years of experience, location, salary, LinkedIn profile, programming languages proficiency
Employee Résumés and/or LinkedIn profiles
Employee agreements and PIAA
Customer list with name, monthly revenue, contract termination date and any other fields if relevant.
Vendor list with monthly spend
Any assets that are needed for the business and will be part of the acquisition
Assets excluded from the acquisition
Early technical diligence:
In case the target company has open source components, the respective Dir. Engineering (dependent on GitLab stage) will start an early code review to determine: code quality, development practices, contributions and more. That should be turned around within 2-3 business days.
Hands-on product and code screen-share session (2 hours): the technical lead, as assigned by the respective Dir. Engineering, together with the respective Dir. Product will lead a screen-share session aimed at a hands-on validation of the product functionalities and an overview of the code.
Founder technical interviews - founders will go through two rounds of interviews to assess technical and cultural alignment.
Résumé review - Review of all employee résumés
Compensation review to identify any gaps and possible flags led by the HR Business Partner
Optional interviews for the key technical employees - to increase the success rate of the deal post-LOI we recommend conducting interviews for the key technical employees identified before signing the LOI. This will greatly reduce the likelihood of personnel gaps becoming a blocker during the Due Diligence stage. The interviews will include a technical interview and a manager interview as detailed in the Due Diligence stage below.
The key technical employees are those identified as critical to the success of the acquisition, the proposed integration plan and the future of the team at GitLab post integration.
Business Case stage
Product integration strategy: the lead PM will formalize the integration strategy with a focus on feature sets/functionalities:
Present business case for internal review of the acquisition proposal.
LOI and Exclusivity Agreement: Using the LOI template(internal GitLab document) and the Exclusivity Agreement, assuming all terms have been reviewed, the acquisition lead will both agreements for digital signing.
Due Diligence stage
To kick-off the Due Diligence stage, email the target company with the following clarifications and information:
All employees and their profiles will be reviewed by the GitLab team
The employees who will be invited for an interview process will go through GitLab's standard interview process
Key employees identified who were interviewed during the Early Diligence stage may go through further interview rounds as determined by the GitLab team to qualify for a role at GitLab
All employees must identify an open vacancy at GitLab which they think best matches their professional profile. This will be shared in a spreadsheet gathered by the target's CEO.
Code diligence - your team will provide access for key engineering contacts at GitLab to: code repositories, products and development/test environments.
Employee evaluations - each engineer will undergo two rounds of interviews comprised of:
Technical assessment - a live coding session, solving a technical exercise or review a merge request with live followup session.
In case of acquisitions with over 10 engineers the employee evaluation stage will happen in phased approach for 5 employees at a time.
In case where there aren't sufficient open recs matching the acquired team, the acquisition team can put a request to the executive team to approve new recs required.
Financial & legal diligence
The progress of the diligence will be synced on a daily stand-up call for the acquisition team
Final internal review call with the acquisition team to recap the acquisition as a whole and present a final recommendation
The Corporate Development team will be responsible to oversee and facilitate the integration of the acquisition post-closing, working closely together with the respective organizations in GitLab, namely: Product, Engineering and Finance. The DRI for the integration stage is Mark Pundsack, VP Product Strategy. This will consist of several aspects and best practices:
Execution of customer sunset plans
Shutdown of target company and it's entities
Alignment on objectives and goals:
Incorporation of the integration plan to GitLab's roadmap
Introduce deal milestones into respective departmental OKRs
Ensuring a product vision formation to the new team's product area
People & Culture:
Integration of new team members into GitLab
Create a cultural integration plan, analyzing similarities and differences in the two companies' cultures.
Identify and continuously revisit business performance metrics to track the deal's added value and ROI over time
Delivery against product plans and OKRs
Forming an acquisition team
An acquisition team will consist of the following GitLab functions:
Acquisition lead, currently Eliran Mesika on all acquisitions
VP Product Strategy
Finance/accounting team member
Legal team member, currently Jamie Hurewitz
HR Business Partner
To assign the product manager, after the product call or as soon as it's clear which product category the features will be implemented into, contact the category product director for the assignment.
To assign the engineer team member, contact the engineering manager of the relevant category for assignment.
Acquisition team responsibilities
1. Main POC for acquired team 1. Identify potential areas for integration 1. Create case for acquisition and customer transition story
1. Business case with deal structure
VP Product Strategy
1. Outline current product features to be implemented into GitLab 1. Outline potential future functionalities to be built into GitLab after the integration period
1. Lead financial diligence 1. Validate business case and deal structure
1. Review entity, assets and existing agreements 1. Evaluate sunset and customer transition path
1. LOI 1. Acquisition agreement
HR Business Partner
1. Lead the compensation review 1. Lead the interview process during the early and due diligence stages to completion
Acquisitions are confidential
At GitLab, we treat acquisitions as confidential and we share the work on them on a need-to-know basis. If you're part of an acquisition Slack channel, GDoc or other internal GitLab discussion and would like to invite another GitLab team-member to one of those, please confirm with the acquisition lead before doing so.