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A funny story about an acquisition that didn't happen  

Don't underestimate people in the startup world. Nathan Lustig:

I met Aayush Phumbhra who introduced himself as Cheggpost's founder. He immediately informed me that they'd just gotten funding, were coming into the Madison market with a huge budget and that we had two choices: join them or get crushed.

I was taken aback. Who was this guy to tell me he was going to crush me? He didn't know anything about my business, it was all bluster. I told him I didn't agree, but I'd listen to what he had to say. I didn't have a good feeling about Aayush and Chegg, but decided to keep talking.

But, later...

Chegg didn't cross my mind for two year, until one day in 2009 I was reading USA Today and read that Chegg had pivoted and raised a nice sized round and was getting noticed by Kleiner Perkins, among others. I couldn't believe it. How could the guys I had gotten to know be winning over valley bigwigs with the same tactics? Besides pivoting business models, I figured they must have learned and became more professional. Over the next two years, I watched as Aayush, Osman and their team turned Chegg into a juggernaut. They raised over $225m and have revenues in the hundreds of millions. There are rumors that they will file for IPO sometime soon at a $5 billion dollar valuation. They are acquiring companies left and right.

What I notice from this story is that despite the fact that Chegg and Aayush set off all his alarm bells, Nathan took the time to consider them seriously and to not burn any bridges when dealing with them. This is important in the startup world, because it's a small and unpredictable world. Even if the person in front of you seems completely useless right now, give it a few short years and they might be doing amazing things.

Bear that in mind before dismissing anyone out of hand.

More from the library:
The born-again entrepreneur
Bootstrapping on the side
Are you building the right product?