As a banker, I figured I&#x27;d offer my perspective:<p>I don&#x27;t think Goldman did anything illegal, but they certainly did a terrible job serving their client. In my view, investment bankers have an obligation to offer whatever financial and strategic advice the particular client needs, which is a function of that client&#x27;s sophistication. Some clients are highly sophisticated, don&#x27;t need any advice, and just want you to find them a buyer at a good price. Others can, for example, simply be good technologists but otherwise not be particularly business or finance savvy, and so will need additional guidance along the way.<p>To look at this particular case, moving from a 50&#x2F;50 cash&#x2F;stock deal to an all-stock deal without an increase in total consideration, or without the client REALLY loving the stock of the acquiring company, makes no sense. Guaranteed money upfront is always preferable (unless there are unusual tax circumstances, which I don&#x27;t see being the case here). This should have been a major point of discussion and negotiation. And if an all-stock deal was decided upon, the client should&#x27;ve been advised with no ambiguity that there are substantial risks involved in such a deal.<p>In any case though, even for the 50&#x2F;50 deal, substantial due diligence on the acquirer should have been recommended. Spending $50k to verify the quality of $290mm+ in sale proceeds is a no-brainer. This legitimately falls outside of the realm of responsibility of the banker to conduct this due diligence though, and should&#x27;ve been performed by a third party with guidance and oversight by the bankers. The bank here is conflicted anyway - their incentives would clearly be to give the &quot;all clear&quot; sign. Falsified revenue is extremely easy to catch - just follow the cash.<p>I guess the lessons here are don&#x27;t work with service providers who don&#x27;t value you, and always keep in mind that ultimately, as the client, you&#x27;re the one that has to live with the decisions that get made.<p>I&#x27;d be remiss if I didn&#x27;t mention that there are better sources of financial advice. At my firm, we take pride in deeply aligning ourselves with our clients by only charging fees upon successful completion of a transaction, and by being compensated in the same form that our clients are (e.g. had we advised Dragon, we would&#x27;ve been compensated in L&amp;H stock, and would&#x27;ve therefore been highly incentivized to strongly recommend due diligence!). The Dragon&#x2F;L&amp;H deal is actually one of the case studies that inspired the genesis of our firm. I&#x27;d love to chat if this resonates with you: lharris@belstone.com.