There are countless stories of startup acquisitions in the media but I have heard that most startup acquisitions are because the startup failed to gain significant traction. As a result, the startup is selling their team (as opposed to their product). Is this true? If so, about what percentage of startup acquisitions fall into this category? And how does this even happen? Is it because the acquirer is friends with the founders or their VCs?
I would say if a startup fails it is very difficult to get acquired - your assets would either be your audience (mailing list) or your technology, if applicable to something else. Otherwise, failure tends to imply there was no product-market fit.