M&A Strategies In The Financial Industry

Bowmans, in collaboration with Benchmark International and DealMakers, proudly presents:

The global information technology (IT) services industry is comprised of multi-billion-dollar firms that span multiple sectors, including many with hundreds of millions of dollars in revenue and concentrated areas of focus, as well as smaller firms that focus on niche markets and specific geographic regions.

La industria mundial de servicios de tecnologías de la información (TI) está formada por empresas multimillonarias que abarcan múltiples sectores, incluidas muchas con ingresos de cientos de millones de dólares y áreas de interés concentradas, así como empresas más pequeñas que se centran en nichos de mercado y regiones geográficas específicas.

The multi-billion dollar containers and packaging industry has experienced steady growth over the past several years and continues to demonstrate a solid compound annual growth rate year after year. Containers and packaging companies are key to the overall global economy, supplying nearly every other sector with solutions for protecting, transporting, preserving, and marketing their products to consumers.

El sector multimillonario de los envases y embalajes ha experimentado un crecimiento constante en los últimos años y sigue mostrando una sólida tasa de crecimiento anual compuesto año tras año. Las empresas de envases y embalajes son clave para el conjunto de la economía mundial, ya que suministran a casi todos los demás sectores soluciones para proteger, transportar, conservar y comercializar sus productos a los consumidores.

Benchmark International is pleased to announce that our very own Kayla Sullivan has been named an Emerging Leader by The M&A Advisor’s 16th Annual M&A Awards. This award is given to a distinguished group of rising stars shaping the future of mergers & acquisitions, restructuring, and corporate finance.

Benchmark International se complace en anunciar que nuestra Kayla Sullivan ha sido nombrada Líder Emergente por The M&A Advisor's 16th Annual M&A Awards. Este premio se otorga a un distinguido grupo de estrellas emergentes que dan forma al futuro de las fusiones y adquisiciones, la reestructuración y las finanzas corporativas.

Programmatic mergers and acquisitions are a strategic approach to M&A deals that companies use to acquire several smaller companies to achieve specific goals, such as growth and value creation. This strategy differs from traditional M&A transactions, which usually involve singular transactions and higher valuations.

The financial services market grew at a compound annual growth rate (CAGR) of 7.7%, from $31.1 trillion in 2023 to $33.5 trillion in 2024. The industry is forecast to grow at a CAGR of 7.6% to reach $44.9 trillion in 2028.

An ever-increasing number of businesses receive unsolicited approaches from buyers yearly, yet a significant difference exists between being accidentally bought and purposefully sold. 

The global accounting services sector continues to grow steadily, up from $652.32 billion in 2023 to $676.73 billion in 2024 at a compound annual growth rate (CAGR) of 3.7%. The market is forecast to see this growth continue in the next few years, surging at a CAGR of 4.4% to reach$804.27 billion in 2028. 

As a business owner, you've poured your heart and soul into building your company. The day might come when you consider selling your business, but the journey from contemplation to transaction is far from straightforward. One of the most powerful realizations in this process is that while you may be considering multiple avenues for a potential sale until you have offers, these remain options. Until you have a choice to sell, the only real choice you have is to continue running your business just as you did yesterday. However, strategically exploring the market and engaging with various buyer types can transform your myriad options into informed choices.

The global fintech (or financial technology) market was valued at $194 billion in 2022. From 2023, it expects to grow at a compound annual growth rate (CAGR) of 16.8% to reach $492.81 billion by 2028. 

Owner’s compensation is a key feature that is addressed in various ways in a CIM. Some variables affect how owner’s compensation is treated in a CIM. Some of these variables include how much salary the owner is receiving, the role of the owner in the business currently, and the owner's role following a transaction. Combining these variables will determine how owner’s compensation is addressed in the CIM. A key point that must be known is that distributions do not affect adjustments to owner’s compensation. Distributions do not affect the income statement of the business, so they are not to be considered when making adjustments for owner’s compensation adjustments.Owner Exiting the Business Post-Transaction

Deal activity continues to heat up in the cryptocurrency space as the adoption of crypto becomes more mainstream. Last year was a huge year for cryptocurrencies. In 2021, the price of bitcoin was up 49%, Ether was up 390%, and Dogecoin was up a whopping 1,600%. The M&A market for cryptocurrency soared by nearly 5,000% last year. But this is nothing compared to the activity for M&A of crypto companies.

An IPO is an initial public offering (IPO), which is the first limited public stock sale by a private company. IPOs are a strategy often used by smaller businesses to raise capital from public investors in order to facilitate expansion and growth. Once public, the company can be traded on the open market. There are both upsides and downsides to taking a company public. 

Handover Process

The global fintech market was valued at $6.5 trillion in 2021 and is estimated to grow at a compound annual growth rate (CAGR) of 13.9% between 2022 and 2028 to reach $16.65 trillion.

If you are considering selling your business, you undoubtedly need to understand its value. Unfortunately, arriving at that answer can entail many different methodologies, and it often involves the familiar valuation formula of applying a multiple of Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA). For example, if a company boasts EBITDA of $1 million, and a five times EBITDA multiple is applied, the company’s estimated value is $5 million. But how do we know what multiple applies to your business? And how do we know if the EBITDA number is even accurate? After all, EBITDA will not be the same for every business.

2021 was a strong market for business owners looking to sell their companies. The market remains ideal and will do so as we move into the first quarter of 2022. As we are in the middle of this year, there is no better time to consider putting your business on the market.