21 Oct Grow fast or die slow: The double-edged sword of M&A
Great article from McKinsey & Co. with some surprising findings about the benefits and risks of buying growth in the software and online-services world.
Acquisitions, done well, can be a powerful tool to accelerate revenue growth. And pushing for gains is vital in software and online services, where the rate of growth typically determines whether a company thrives, survives, or dies. While 20 percent revenue growth is enviable in most industries, companies in software and online services are expected to deliver numbers that are markedly higher. In fact, we’ve found that software and online-services companies with revenue that grows by more than 60 percent annually when they hit $100 million in sales are eight times more likely to eventually pass $1 billion in annual revenue than players with revenue that grows by less than 20 percent annually.
Read the full article here.