At our Growth and Exit Planning Conferences, we are often asked to explain why M&A has held up strong so far in 2022 given all the uncertainty surrounding us and our economy. The answer is simple: turmoil creates opportunities and savvy buyers are taking advantage of them to grow market share, gain access to new technologies, and add experienced workforces to their stable of associates (along with a plethora of other reasons).
Turbulence has increased since we launched our Global M&A Report six months ago, and it will likely continue throughout the year.
In the face of so much turmoil, it’s easy for corporate dealmakers to get conservative, yet the fundamentals exist for continued robust M&A activity.
Based on the first five months’ performance, 2022 will likely reach $4.7 trillion in deal value by year-end, which would make it the second-best year on record.
We believe that winning M&A teams will revise their M&A playbooks and deploy scenario planning that rigorously assesses the range of outcomes in five key areas of M&A uncertainty.
Interestingly, Generational is a bit of an outlier here, largely because of the niche we serve: middle market, privately owned companies the demand of which has never been higher. In fact, 2021 proved to be a record year for our firm and YTD our deal closings are 17% ahead of last year, which we expect to continue through the end of 2022 and beyond. Bain was reminded of a famous Warren Buffett quote as it looked at this data:
Warren Buffett reminds all investors in assets that the time to be greedy is when others are fearful—and that the time to be fearful is when others are greedy. These are turbulent and scary times, but they also are times in which the shape of many industries will be set for the next several years.
Buyers that we deal with regularly are of the same mindset: Now is one of the best environments to make acquisitions in years. Those sellers sitting on the sidelines waiting for “times to get better” will likely rue this strategy not far down the road as the seller’s market will eventually evolve into a buyer’s market.
So, the key question for you, if you own a business today, is where do you stand in relation to your exit plan? Do you have one in place? Is it in writing? Do you know the current economic value of your company? Do you have any idea of key intangible assets your firm has that can make it even more valuable? What do you want to do with the time left in your life post-exit? How much capital will you need to reach that goal?
These are critical questions that need to be addressed/confronted/analyzed and decisions made. Thankfully, Generational can help you on your journey. We have done so for countless business owners over the years and can do the same for you. Here are just a few of our examples for you:
To see a full sampling of all our clients we have helped to capitalize on their greatest asset, please use this link.
The important point to consider is that right now there are multiple buyers out there for every seller. This will gradually change as interest rates rise and the number of baby boomer business owners retiring increases. Don’t hesitate, act now! Contact us to find out how.
Carl Doerksen is the Director of Corporate Development at Generational Equity.
© 2022 Generational Equity, LLC All Rights Reserved
it all started with a conference.
start your story today,
speak directly with one of our senior advisors +1-972-232-1121
The information we learn from customers helps us personalize and continually improve your experience. Here are the types of information we gather.
We receive and store any information you enter on our Web site or give us in any other way. We do not sell or rent your personal information to others without your consent. We use the information we collect only for the purposes sending promotional information, enhancing the operation of our site, serving advertisements, for statistical purposes and to administer our systems. We DO NOT use third parties to provide customer service, to serve site content, to serve the advertisements you see on our site, to conduct surveys, to help administer promotional emails, or to administer drawings or contests, but reserve the right to do so in the future without advance notice.
Generational Consulting Group’s affiliates are all part of one corporate family, they work with one another and may work together to provide services to you. The sharing of your information among affiliates enables Generational Consulting Group to serve you more efficiently and makes it more convenient for you to do business with Generational Group. Generational Consulting Group is permitted by law to share information with its affiliates. All of our affiliates follow similar privacy policies.
For reasons such as improving personalization of our service, we might receive information about you from other sources and add it to our account information.
Generational Group may license the use of its intellectual property including but not limited to its name, likeness, and logo for the use of affiliated offices. Such affiliated offices may not be owned, controlled, managed, supervised or staffed by employees, officers, or agents of Generational Group. Affiliated offices may be independently owned and operated. For more information about a particular office, please contact Generational Group at its office in Dallas, Texas.
This page may contain other proprietary notices and copyright information, the terms of which must be observed and followed.
Information on this web site may contain technical inaccuracies or typographical errors. Information may be changed or updated without notice. Generational Group may also make improvements and/or changes in the products and/or the programs described in this information at any time without notice.
Generational Group does not want to receive confidential or proprietary information from you through our web site. Please note that any information or material sent to Generational Group will be deemed NOT to be confidential. By sending Generational Group any information or material, you grant Generational Group an unrestricted, irrevocable license to use, reproduce, display, perform, modify, transmit and distribute those materials or information, and you also agree that Generational Group is free to use any ideas, concepts, know-how or techniques that you send us for any purpose.
Our computer system protects personal information using advanced firewall technology.
Information Generational Group publishes on the World Wide Web may contain references or cross references to other products, programs and services that are not announced or available in your country. Such references do not imply that Generational Group intends to announce such products, programs or services in your country. Consult a Generational Group representative for information regarding the products, programs and services which may be available to you.
Generational Group makes no representations whatsoever about any other web site which you may access through this one. When you access a non-Generational Group web site, please understand that it is independent from Generational Group, and that Generational Group has no control over the content on that web site. In addition, a link to a non-Generational Group web site does not mean that Generational Group endorses or accepts any responsibility for the content, or the use, of such web site. It is up to you to take precautions to ensure that whatever you select for your use is free of such items as viruses, worms, Trojan horses and other items of a destructive nature.
IN NO EVENT WILL Generational Group BE LIABLE TO ANY PARTY OR ANY DIRECT, INDIRECT, SPECIAL OR OTHER CONSEQUENTIAL DAMAGES FOR ANY USE OF THIS WEBSITE, OR ON ANY OTHER HYPERLINKED WEBSITE, INCLUDING, WITHOUT LIMITATION, ANY LOST PROFITS, BUSINESS INTERRUPTION, LOSS OF PROGRAMS OR OTHER DATA ON YOUR INFORMATION HANDLING SYSTEM OR OTHERWISE, EVEN IF WE ARE EXPRESSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Furthermore, all information contained within this website is the property of Generational Group.