Category Archives: Investment Trends

Posts concerning investment trends

What is a Deal?

For those of us in the merger and acquisition or “deal” business, buying and selling companies is second nature. We live through transaction after transaction, buying and selling companies as routinely as middle market businesses provide their own products or services. But, in most cases, the people involved in the middle market companies we buy and sell go through the merger and acquisition process only one time. Most entrepreneurs and business owners don’t know what to expect from a sale Read More [...]

Minecraft and an M&A Bubble?

My current Forbes column discusses Microsoft's rumored decision to buy Minecraft developer Mojang for $2.5 billion.  Apparently someone at Microsoft really likes Minecraft and is willing to pay anything to play it on a Windows phone. While the deal is interesting, the real point is that the M&A landscape is truly frothy, even in the middle market.  Seeking Alpha posted a great article last week highlighting some notable deal statistics, including debt multiples and EBITDA multiple trends. Overall, Read More [...]

More on “Buy and Build”

Last week, Forbes published my article on "The 'Buy and Build' Strategy - Spotlight On A Modern Day Private Equity Trend." One aspect of these strategies that I didn't mention in the article is the size and capabilities of the companies that are used as the platforms and as the add-ons. Generally speaking, private equity investors need to be able to scale investments quickly in order to make a Buy and Build strategy work.  Consequently, the platform company needs to have management and infrastructure Read More [...]

2014 M&A Trends

Last week, Axial posted a list of "14 Must Read Quotes from 1H 2014," which included my thoughts on top trends impacting deal flow quality and price.  The list includes a variety of insights and developments in M&A. I thought I'd highlight a few of what I thought to be the most interesting and relevant points for my clients: 1.  Quality of Earnings Reports: Expect that buyers will want to do a Quality of Earnings Report as part of the due diligence around a transaction.  This has become Read More [...]

Facebook and the Psychology of Middle Market Deals

Last week, Forbes published my article "Facebook's Shopping Spree is Sending Ripples Through the Middle Market." The important takeaway from the article is that psychology is crucial to middle market M&A deals. While at the end of the day, most entrepreneurs don't expect to sell their companies for $19 billion like WhatsApp or Kickstart their way to a $2 billion deal like Oculus VR, Facebook's shopping spree can't help but to affect middle market owners that see the buckets of gold being Read More [...]

Global M&A Passes $1.2 Trillion in 2014 YTD

The Financial Times reported yesterday that to date, 2014 has produced $1.2 trillion worth of global M&A transactions.  This is the largest amount since before the big recession, when in 2007, M&A hit $1.4 trillion over the same time period. While obviously, much of this volume has been driven by mega transactions valued in the tens of billions, there is application to the middle market as well.  The reason is that the forces driving mega transactions are also driving middle market deals. 1. Read More [...]

New Articles

Last week, I had two articles released by leading publications. First, Middle Market Executive published "Increasing Your Company's Value by Streamlining the Black Box." Generally, the main takeaway from the article is that you should review your balance sheet to ensure that you are deriving as much value from it as possible. While it is possible to get value from excess capital present on your balance sheet during a transaction, it is much easier to streamline your balance sheet and extract Read More [...]

Investors Continue to Look to Lower Middle Market

Michael Wursthorn of Dow Jones & Company recently reported that Riverside Co. concluded fund raising for its sixth flagship fund at $1.5 billion. While interesting, that is hardly news since raising and investing vast sums of money is what firms like Riverside do. The interesting kernel in the article for my clients is buried deep two thirds of the way down the page. Wursthorn commented that “For Riverside, however, an increasing number of limited partners continue to look to the midmarket, Read More [...]