Our M&A Webinar 3.0 with David Schafran, Director of Strategic Coaching at Pax8 examines why it is important for MSPs/TSPs evaluating an acquisition or merger to go “beyond the numbers” and consider other key elements of the business. Let’s dive in.
David explains companies that build an integration plan even before the acquisition closes will have their resources and people in place to hit the ground running. They know what to focus on in the first 30 days, what must be accomplished in the first three months, and what can be put on the back burner.
His advice reinforces Arlin Sorensen’s directive in M&A Insights 1.0 to plan your exit strategy two years before you intend to sell your business.
As we learned from Peter Kujawa on an M&A Insights 2.0, ideal merger partners and acquisition targets share comparable maturity levels. David notes that similar operations, using the same PSA or remote monitoring and management software is no indicator of compatibility. When it comes to M&A, culture, including target client profile, service delivery, and product focus, counts most. These differences can be workable and even desirable for expansion purposes, David says, but only if they are understood going into the deal.
David helps MSPs integrate and deliver structured operational improvements for acquiring businesses. He starts with a “generic” template of 350 line items to address. The list grows as he customizes it for each Pax8 client. No one really understands the details, nuances, and work involved until they have gone through the process. Economies of scale and best practices implementation don’t materialize overnight. They can only be achieved after tools, technology, and the workforce can be right-sized and acclimated to the new reality.
Learn more about how you can improve your profitability, operations, and client relations with these insights
Learn why MSPs/TSPs with mature business operations can improve the probability of greater profits over time.
For a MSP/TSP merger or acquisition to be successful, it is paramount to seek out a target with a complementary operational maturity level.
ConnectWise’s Arlin Sorensen and MSPCFO’s Larry Cobrin discuss the MSP M&A landscape and optimal owner exit strategies.
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