Talk to any founder or investor who’s successfully done an acquisition and listen to how much work they put into making it happen.
Over the past three months we’ve seen a marked increase in inbound demand for people exploring exit opportunities. Just this past week I’ve talked to eleven separate founders, one of the most prolific angel investors in the US, and the head of corporate development from one of the world’s largest venture portfolios who are all actively looking to find exit and liquidity options for their companies.
2016 is setting up to be the most active year for technology M&A in the history of the industry due to some key contributing factors:
- Large amount of supply – thousands of companies are coming to the end of their vintage fundraises from 2013 and 2014, which were the most active years of VC investing since 2001.
- Concern about easy access to private capital – venture investors have slowed down.
- Devaluation of private markets, as demonstrated by large institutional investor write downs.
- Concern about world markets and general macroeconomic stability.
- A weak IPO market for technology company liquidity.
- Huge amount of demand: every company is now a software company, whether they sell sugar water or build buildings.
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