New Work Management Platform Technologies Will Reshape the M&A Landscape in 2024

By Jude McColgan, CEO, Midaxo

Research shows companies using acquisitions as an active element of their growth strategy outperform companies relying solely on organic growth by 3.8x. The most successful acquisition-based growth strategy is programmatic, acquiring two or more smaller companies per year using structured, repeatable M&A processes. M&A work management platforms have become indispensable for their ability to standardize end-to-end processes, centralize documents and communications, empower collaboration across the extended M&A team, and enable end-to-end visibility and reporting.

These platforms have already delivered major improvements across the entire M&A process for thousands of companies. In 2024, new technologies will make them even more powerful, enabling businesses to dramatically reshape their corporate dealmaking strategies and processes.

1. AI Will Transform M&A

AI embedded in work management platforms will transform M&A, enabling teams to identify better deals, conduct faster and more insightful due diligence, and ensure maximum value realization during post-merger integration. Teams can already benefit from AI in M&A using solutions such as those for contract reviews. And users can already begin reaping the next-level, game-changing benefits of AI-powered M&A platforms now with a significant acceleration of new capabilities coming to market in 2024.

1. Corporate Development Teams Will Join the AI Wave

Innovation through the smart use of technology has become a core competency for nearly every company across all industries. Corporate development teams are now joining that trend. As AI-powered technology becomes increasingly embedded in cloud offerings, corporate development and M&A teams are beginning to adopt automation technologies at breakneck speed. In 2024, artificial intelligence, machine learning, and data analytics will increasingly shape corporate development strategies and drive efficiencies, time savings, and speed in responding to regulatory challenges.

1. Technology Changes the Corporate Growth Game

According to the McKinsey report The ten rules of growth, companies relying predominantly on organic growth grow far more slowly than companies that rely predominantly on M&A-driven, inorganic growth. However, M&A has a notoriously high failure rate, as high as 60-70%. A frequent contributor to M&A failure is the use of point solutions such as Microsoft Excel and Outlook to manage inherently complex workflows that require collaboration across team members. New technologies have changed the rules of repeatable inorganic growth by overcoming those inefficiencies. In the coming year, purpose-built work management solutions will become secret weapons for corporate development and deal integration teams to find, evaluate, and deliver deals that drive faster inorganic growth more efficiently than ever before.

1. Rapid Growth in Antitrust Reviews Will Drive Adoption of M&A Work Management Platforms

Following the large spike in M&A deals in 2020 and 2021, activity by strategic investors has returned to typical historical levels. However, acquisitions by private equity firms have fallen substantially due to much higher interest rates. In 2022, strategic investors also faced new challenges from a significant increase in antitrust reviews. In the coming year, both companies and PE firms will adopt M&A work management platforms as the new secret weapon for responding faster and more completely to antitrust challenges. A platform enables companies to streamline their diligence processes and more quickly respond to FTC challenges, which may become even more stringent in light of the proposed overhaul of federal antitrust guidelines. These platforms can also enable faster deal closings, improve value capture, and ultimately accelerate inorganic growth. Time to close a deal is now a competitive differentiator in winning deals, and M&A work management platforms are a key to achieving efficient and accelerated closings.

Welcome to Change in 2024

Given the continued unsettled economic environment, the accelerated pace of technology development, and the increasing scale and complexity of deal-related data, a programmatic M&A strategy will become a critical growth strategy for companies seeking inorganic growth in 2024. Success, however, depends on doing programmatic M&A the right way, which will make evaluating and adopting an M&A work management platform a critical success factor in the coming year.

Jude McColgan serves as the CEO of Midaxo, a leading provider of software solutions for corporate development.