$3.7 Billion Choice: Jyoti Bansal's Decision Transforms 400 AppDynamics Employees Into Millionaires

In the fast-paced world of startups, decisions can make or break not just a founder’s fortune but the lives of countless employees. The founder of AppDynamics, Jyoti Bansal, also faced a similar crucial juncture in 2017. Days before going public, Bansal was approached by Cisco and offered to buy his company for a whopping USD 3.7 billion. But the interesting point to note here is that both choices promised wealth but Bansal prioritised the financial futures of his employees, making what he called “the hardest decision” of his career.

As per CNBC Make It report, his decision led to a windfall for around 400 AppDynamics employees, many of whom saw their shares soar to values of at least USD 1 million.

Outcomes for Employees

As a result of the acquisition, many employees of the company had a life-changing financial benefits. According to CNBC Make It report, many of these employees became millionaires overnight, with dozens achieving outcomes exceeding USD 5 million.

Decision-Making

His decision apart from the emotional factor involved careful considerations of various other factors. This included a weighed compatibility of AppDynamics' software with Cisco’s offerings. Furthermore, he also assessed how the sale would influence the startup's culture and the financial security of its nearly 1,200 employees, added the CNBC Make It report.

As per CNBC Make It report, he also compared potential post-IPO projections against Cisco's valuation, concluding that selling reduced risk for his team.“

How the sale reflected

Despite the success that followed the acquisition, Bansal later also felt a regret over selling AppDynamics. As he shared with CNBC Make It, he believed he could have continued growing the company and felt lost without a startup to manage. However, he highlighted that given the circumstances at the time, the sale was the right choice. His ownership stake of over 14 per cent also ensured substantial financial security for him.