From Peer Power: M&A As A Growth Strategy
Without a doubt, one of the hottest growth tactics in the IT market right now is the use of mergers and acquisitions (M&A) as a strategy. Having done seven of these transactions during the time I owned an MSP, there is no doubt that I’m a believer in the tactic as a great approach to growth.
But there are some things that you need to be aware of, and cautious about, before you run headlong into a series of M&As or even your first one, for that matter. According to data collected by Service Leadership, Inc., almost 40 percent of solutions provider companies were founded over 20 years ago. That means a lot of owners are entering the time when exit or transition moves up on their priority scale, and they are looking for what comes next. Opportunity is ripe in the channel.
I want to walk you through several common challenges that I have faced or seen others face during a merger or acquisition. I will also share several strategies that are helpful in navigating those challenges well.
One of the biggest challenges that occurs when engaging in M&A activity is allowing emotion to become part of the process. Whether you are the buyer or seller, you need to take emotion out of the picture. As a buyer you can become almost frenzied and obsessed with getting a deal done, particularly if it is your initial one.
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