How I helped manage the merger of two of Australia’s top app firms

App and game makers Infinite Interactive and Firemint announced earlier this year they would merge, combining the assets and intellectual property of two of Australia’s most successful and well known developers.

Combining businesses can be a tricky thing to manage. Infinite chief executive Steve Fawkner says he and Firemint chief Rob Murray had to come up with different ways to make sure the transition was as smooth as possible.

When did the idea of a merger begin?

It actually kicked off about four or five years ago. We’ve known each other for close to 10 years and I think it was about 2004-05 that one of us brought up the idea of creating a super team and putting the two companies together to get the best of both worlds.

We thought it was a great idea but at the time we both had a bunch of projects halfway through and if we splashed the two companies together the projects would run off the rails. Publishers would be uncertain.

We must have talked about it half a dozen times and it just so happened that at the end of 2010 we were between projects and we downsized as a result of that. We thought why not put the two together now?

Because you were talking about it for so long did any employees know anything?

There was a certain amount of confidentiality around the project. Although we did bring the employees in very early and told them what was going to happen and everyone was very excited about it all.

How did you break the news?

On the Infinite side we were never a huge company, we were down to about 20 employees at the merger. We just called a big team meeting as I normally would when we would announce our next big project and I announced that our next big project would be the merger with Firemint.

You were probably hit with a lot of questions when you first announced the deal. 

Obviously you get a lot of questions about a situation like this. People asked whether they were getting paid the same, about their annual leave, very straightforward questions about who they would be working for and so on, which are very reasonable questions.

Rob and I worked ahead of time to answer those and really it came down to the fact that not much was changing. Everyone started working in the same teams to start with and then through osmosis they have started moving onto other teams. It’s been handled pretty well.

When you’re putting two companies together the one place things can go wrong is in the integration.

And how did you manage that integration? What did you want to make sure you got right?

You don’t want to take people out of their comfort zone too early. You want to make sure that no one has been thrown into a job they don’t understand or that they’re working under a manager they’ve never worked with before or have expectations that aren’t being managed.

It’s all about keeping everyone on familiar ground and the same was true for the Firemint side, making sure they’re on the same familiar ground as well.

I didn’t immediately move over as a design director. I moved over as a project lead on the properties we were working on and the team members didn’t immediately go to Firemint projects. Over the first few months I started working on more projects so I could rest as design director.

Were they any particular things employees were worried about?

People were worried about their jobs, their incomes, their entitlements, very reasonable things. The answer in that situation cannot be “I don’t know” or “I’ll check and find out”. You need to have answers to those 20 questions you’re always going to get.

Otherwise you simply look like you don’t know what you’re doing. There are laws for all this type of stuff, for existing entitlements, payouts and so on and it’s just a matter of checking out the legal stuff before you go ahead.

What about logistical differences, did anything come up there?

We’re actually just a couple of kilometres away, so logistically it wasn’t a big thing. A few people had to switch their trains but it wasn’t like moving from Melbourne to Sydney, it’s all kind of in the same ballpark.

There were a few little quirks in the office, the Firemint guys have their own beer-o-clock and that sort of thing, which they enjoyed.

How did you combine the two individual cultures?

I think because the merge was us going into Firemint you want to bring along your own kind of work practices but you don’t want to try too hard to maintain it because you want to get in with Firemint. But it’s actually been easy because our practices are quite similar.

However we’ve had more flexible working hours, more flexible than Firemint, and that was something where we had to say this is what we have to compromise on.

Could you explain more on that?

That flexible hours switch is a good example. Infinite was very flexible in that we could have any of our people start up to 11then do the hours. Firemint is more of a 9-6 kind of place and it’s an improvement because we get much more face time.

For other businesses looking at integration, how should they approach it?

Make sure it’s a good fit. If it’s being done it needs to be for the right reasons and right reasons can’t just be a bunch of money in your pocket. You have a responsibility to know how things will work when you merge and how that process will roll out.