3 Reasons to Examine the New World of Tech M&A Buyers

Here at Corum, we're transactional. We've closed over 300 transactions. We're students of the market because the more we know, the more we can help our clients get deals done. And one thing the market has been telling us is that the world of buyers for technology companies is very different than it was even just a few years ago. Some buyers you many never have even heard of before. That’s why we think there are at least three good reasons to examine the new classes of buyers as you consider your company’s future.

 

  1. Valuations are up, broadly. If you just see a couple of transactions that are high value, it’s interesting, but it’s not really a trend until you see volume at those levels. We are now seeing volume at high valuation levels, and this means more buying on the horizon. 

 

  1. IPOs are back. After the dot-com, we lost over 600 companies from the NASDAQ to liquidation, bankruptcy, and privatization. Over the last ten years, the number has continued to shrink. The IPO boom that we're seeing now is finally replenishing those numbers. That creates buyers and opportunity for everybody. Across the country and the world, buyers are everywhere, and there is money in their pockets and they’re making deals happen.

 

  1. M&A activity creates more M&A activity. Every time a buyer does a deal, their competitors have to sit up, take notice, and respond in kind. That’s what we're seeing now. One company makes an aggressive move like Zillow. Guess what? You'll see an explosion of transactions across that marketplace because you had two big competitors and now you have one giant one, new opportunities are opening up, and you'll see new opportunities in that vertical market. That’s just one example. This is a market that you want to transact in.

 

For more on this topic, watch our special report on buyers from our webcast last month: 

 

Posted by , on 17 September 2014
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