Every year, here at Corum we leverage our unique vantage point in the marketplace to develop the Top 10 Disruptive Trends that we see driving tech M&A. We take the thousands of interactions with tech companies through our educational conferences; the research for events like this one; and our thousands of conversations with buyers on behalf of our clients and synthesize it into the leading list of its kind every year. Whether you are a tech company CEO considering the M&A market today or a buyer seeking to make acquisitions, these are the trends that you want to understand as they shape the tech M&A environment.

One of the reasons why buyer demand for technology companies has remained strong even through the somewhat chaotic we continue to see extraordinarily strong tech M&A in the last year, even with somewhat chaotic economic news, is that the sheer amount of disruption happening creates the change that drives strategic imperative for buyers—properly positioning your company in relation to this disruption is critical to getting the true value of your company. Well positioned companies get sold. So, let’s take a look at our Top Ten Disruptive Trends for 2024.

As in the past, our “Foundational” trends are those that are changing things at a core level of society, technology, or the economy, while “functional” trends describe how that disruption is playing out in specific markets and technologies. Let’s dig in.

We’ll start with a twist on an old favorite—GenAI Enablement. It’s been a while since we’ve seen a trend step directly from the headlines into significant demand on the M&A side. Typically, buyers are cautious, even cynical, about the latest trends, but the potential of generative AI is clear enough to move past that. And not just the potential, but real companies are generating real revenue from GenAI right now—I’ve seen the financials for companies who were already active here, and you could literally see the inflection point of November 2022, when ChatGPT was released, in their revenue graph. I’ve seen other companies go from zero to hundreds of thousands of MRR in just by addressing a niche created by this new ecosystem.

And on that ecosystem note, it’s not just companies leveraging generative AI that are seeing interest. As in previous iterations of the AI Enablement trend, both those companies enabled by GenAI and those enabling it will benefit. That’s particularly true here where unique needs are already being felt, especially around Large Language Models and the required management, quality assurance, compliance, orchestration, training and customization needed at the infrastructure level. GenAI is extraordinarily compute-intensive which means that technologies enabling more or more efficiently used processing power will be in demand.

Within GenAI itself, systems that drive autonomy on one hand—autonomous agents, for example—and those that enable and improve human collaboration will be key.

Finally, a word of warning—the heat in the GenAI market is a double-edged sword for smaller tech companies. If you’ve built exciting tools in this space, you’re likely seeing significant customer interest and will see significant buyer interest if you go to market—for now. But all the major players are betting on this space and what is unique and highly valuable today may be eclipsed tomorrow—we strongly encourage companies in this space in particular to calibrate the market today and find a partner to help them weather the exciting, competitive future of Generative AI.

Next up, last year’s leading trend and still key to the landscape, People Centric Productivity. The heart of this trend is the fact that, while automation was expected to make the human workforce obsolete, instead, changes in the labor market have made workers even more efficient and valuable. Despite advances like GenAI and despite rocky economic environments, unemployment rates in the US at least have remained at historic lows. This environment is driving M&A for two kinds of companies. On the one hand, it’s those companies with technology to help attract, retain and engage employees. HR tech M&A in 2023 was down from its record peak in 2022, but still running ahead of 2021 which was itself a record. The window for successful companies that successfully address recruiting, workforce management, employee engagement and related needs remains open. This includes companies like Corum Client theEMPLOYEEapp providing engagement solutions for deskless workers, sold to Engagedly, but also compliance and safety solutions for employees, like Corum Client OK Alone, sold to Peoplesafe.

The other side of this is the software that helps employees do more with less, improving their productivity, automating drudgery and letting them focus on the tasks that human beings are uniquely suited for. This can be more horizontal tools like Corum client OnePlace Solutions, acquired by Ideagen, but there’s even higher demand for automation, workflow optimization and other efficiency solutions that have been purpose-built for vertical markets—like Corum client {{X}}, sold to {{Y}}.

Actionable Analytics is a broad term for technology that turns data into prescriptive insights that enable faster, better decision-making up and down the corporate ladder. These are not usually visualization or not generic analytical tools but tend to be embedded in the platforms that can access the right data, run the numbers and point to optimal actions, as well as the supporting data management technologies that undergird the entire data infrastructure that make these advanced analytics possible.

Business intelligence tools that prove actionable for users are in strong demand, like Corum client Gazelle.ai, acquired by Lightcast—Gazelle’s proprietary AI-enabled tools forecast a company’s likelihood to expand, enabling better decisions for a wide swath of users.

Next up, a new trend to the set that we’re calling CashflowTech—we’re seeing multiple trends converging here to drive significant interest in technology that enables businesses to achieve, maintain and optimize consistent cash flow. Richard Branson calls cash flow “the lifeblood of business” so it’s no surprise that companies that focus here are in demand. Some of the M&A here revolves around software solutions with embedded or integrated fintech components. Chief among these is enabling and leveraging the flow of payments, a core strategy of acquirers like Fullsteam which acquired Corum client Rubicon Group, provider of a vertical ERP for wire and cable manufacturers. It’s also driven by a focus by many acquirers on the Office of the CFO as a core segment, with many vertical-market focused acquirers now treating this as their own vertical. Corum sold Centerviews, a provider of Robotic Process Automation for Accounts Payable and Receivable, to Digital Visor, in one example. We’re also seeing activity around insurtech, billing, subscription management—and it touches on pricing and inventory management as well, which helped drive deals for Corum clients Neatoscan, acquired by Cordance, and Alterity, acquired by CAI.

This relates directly to our next trend, EverythingOps. The original ops, DevOps, focuses on enabling continuous improvement by ensuring clear feedback loops between those developing applications and those putting them into operation, leveraging communication, automation, and measurement. The next evolution, BizDevOps added a third loop and integrated overall business strategy, including cash flow, into this continuous delivery process. This “Ops” concept has proved valuable across tech infrastructure—think MLOps, SecOps, CloudOps—but also in other contexts—SalesOps, MarketingOps, ProductOps, even HealthOps and EnergyOps. If your software is enabling the flow of data, and the communication, measurement and automation across the value chain that is needed to enable continual improvement, whether in code, sales, service delivery or whatever else, you’re creating the kind of product that can be key for a buyer either to fit into their own suite of tools or as a platform for others. A great example is Riverside Company’s investment in BusyBusy, a construction employee and asset tracking app that leverages that data into real-time insights not just for crew productivity, but improved job costing and estimating and better strategic decision-making overall.

Next up, Focused Managed Services. This is the prism through which buyers primarily look at services companies these days, whether pure IT services or tech-enabled services of various kinds. Buyers are looking for both the predictability of recurring revenue and long-term relationships, and well as the deep, specific domain knowledge that makes those customer relationships possible. This can be a focus by sector, like our sale of engineering and design services provider VPI Technology to Ludlum Measurements. Or, it can be by ecosystem, such as the sale of our client Vetasi, a leader in the IBM Maximo space, to Bentley. Generally speaking, it’s easier to sell a hammer than a toolchest, so this kind of focus can definitely drive buyer demand, and especially for those services firms that are also leveraging one or more of the other trends we’ve talked about.

We’ve been talking about the Healthtech Continuum trend for quite a while, but in a famously slow-moving industry it’s going to be a long time before it changes. Traditional inpatient health systems need a unified view of patients across the continuum of care, both before and after they enter the facilities, while outpatient providers of all kinds need comparable capabilities, often purpose built for their practice area. Similar capabilities are needed on the treatment side, from drug discovery to clinical trial to administration. Tech companies filling gaps across both continuums and driving improved results—financially and clinically—are seeing demand. Solutions for the post-acute market remain in high demand across care management, staffing and patient management—and upstream, we’re seeing significant demand for clinical trial software and other software enabling treatment development. Corum sold Drug Interaction Solutions, a spinout from the University of Washington that built the market leading database of drug interactions, to Certara to enhance its biosimulation modeling capabilities.

Regtech Systems remains an active trend, on both sides of the regulatory coin. Technology that more easily enables compliance – across GRC, EHS, ESG and more – is in demand. I mentioned OK Alone in the worker safety space, but also Promium, enabling environmental and public health compliance, acquired by Clinisys, are good examples. But we also saw surging interest in software serving the regulators themselves especially state & local government solutions—FileOnQ, acquired by Sloan Street Capital, serving Law Enforcement; MetroQuest, acquired by SocialPinpoint, serving departments of transportation; and Spatialest, acquired by Schneider Geospatial, serving county assessors. Then there’s Drug Interaction Solutions that I just mentioned—mission critical for both regulated life science companies and the regulatory bodies themselves.

Many of these previous trends are being focused on frontline workers of various kinds in the Blue Collar Software trend. From the deep vertical niche software that is in huge demand from private equity funds of all sizes, to broader segments like construction, agtech, energy and manufacturing, the digital transformation changing the roles of blue collar workers remains one of the key facts of life in tech M&A. Niche solutions in specific blue collar industries drive many deals—like Minotaur Software acquired by CAI served meat processors; Rubicon Group acquired by Fullsteam served wire & cable manufacturers; while NeatOscan acquired by Cordance Software, primarily served secondhand retail stores. Cordance also acquired BuildCentrix, a design & ERP suite for HVAC, ducting and related trades. But it’s not only niche software that can benefit from this trend—TheEMPLOYEEapp deal I mentioned earlier is relevant here, as they focused their employee engagement solution specifically on connecting deskless workers across industries with the key information from employers.

Let’s close with Built Environment Technology, where we’re seeing the same thing happen with the physical environment that we’re seeing happen with workers in the Blue Collar Software trend. On one hand you’ve got software solutions like digital twins, Building Information Systems and Enterprise Asset Management. On the other hand, you’ve got sensors enabled by AI on the edge, plus automation and controls enabled by software and feeding data back into those systems. Technology that digitizes the physical environment—and more importantly leverages that digitization—is driving buyer interest. The acquisition of Corum Client BIM solution provider UNIFI by Autodesk is a great example, and we’ve done relevant deals with Hexagon, Bentley and others recently. Both financial and strategic buyers are paying close attention to this trend.