Forty-eight of Rainier’s clients, for whom we’ve been the PR agency of record, have been acquired for a total of nearly $10 billion. The basis for the valuations of these companies ranges from multiples of profits to acquisition of pure intellectual property that wasn’t even yet monetized.

But what’s become clear is that companies sell for the amount that someone else wants to pay for them. Before you say, “Duh,” let me emphasize the word “want” in that sentence.

How much is a company worth? Whatever amount someone is not just willing, but eager to pay. So it comes back to Rainier’s concept of using marketing to engineer behaviors. And in this case, the behavior we want is for someone to pay a premium to buy your company. Marketing in this context is the opportunity to be perceived as more desirable, and much bigger than you actually are.

Behavioral economics expert Dan Ariely says that one key factor at play is FOMO – the fear of missing out on a crucial strategic opportunity.

It’s like when Decca Records rejected The Beatles in 1962, saying "Guitar groups are on the way out." I can guarantee, no one wants to be associated with a painful and regretful missed opportunity like that, and it’s no different in the rough and tumble world of technology. After all, FOMO is basically an emotional function of regret.

So the companies with deep pockets and money to spend bring a visible sense of urgency to snap up strategically advantageous technologies. They not only want to make sure they acquire technologies and the teams that created them, but they also want to take these companies “off the shelf” making it impossible for their own competitors to engage or acquire.

Now, if you think this all sounds like marketing fluff, our friends in accounting will tell us that there’s an intangible asset located in every company’s financials: goodwill.

Goodwill is the excess of the money paid to purchase a business above and beyond the net value of assets minus liabilities – basically the amount over book value.

Goodwill in the balance sheet is strictly an emotional, psychological quantity.

And we know that the best way to elevate emotional value is through creating and delivering strategic messaging that changes market belief systems to build a positive perception of your company and your brand. 

This is why we companies like MobileEye, Orbotech, WhatsApp, Mellanox and Worldpay were all acquired for jaw-dropping sums at unheard-of multiples.

Look, acquisition valuation is a function of goodwill, and goodwill is a direct function of good marketing. Through PR and content generation, you control the market agenda, and you control a big part of building your company’s goodwill and value.