Running your business News
IT M&A Expert: Over $5 Trillion In Transactions Completed In 2021
Joseph F. Kovar
Tim Mueller, president of martinwolf M&A Advisors, says he’s ‘still very bullish on the marketplace’ as he outlines the factors solution providers looking for growth should keep in mind when determining whether to build, buy or sell their business.
Growth Option No 1: Build
Mueller said solution providers looking to grow have three options: build, buy or sell.
Building one’s business organically is relatively simple, Mueller said. It allows the business owner to keep his or her fingerprint on the business if the owner understands that the financial resources needed to grow the business are available.
“If you’re looking to grow more than 10 [percent] or 15 percent per annum, then you really do have to have the patience and the financial wherewithal to get that deal done,” he said. “But remember, buying versus build is not mutually exclusive. You can continue to build the business, but when a target acquisition comes along that can accelerate your growth, you can pivot very quickly to become a buyer if build is really more of your strategy to begin with.”
“Thoughtful” organic growth needs to stem from a company’s strategy as set out by the founder or board of directors, Mueller said.
“It really does require a very deep and skilled management team that starts from the top down at the CEO, but includes business development, execution teams, delivery teams, all working in concert, so that there really isn’t an ability to have a misstep when you just decide to grow organically,” he said.
Even so, most of the companies that martinwolf works with underestimate what it takes to build a service or to build a product from scratch in order to become a “leader,” Mueller said.
“[It] requires a lot more infrastructure, and so you need to make sure that that infrastructure is in place in order to ensure that it could handle that growth,” he said.
