How would that work?
Clearly they would integrate with the mash and peas (onion rings would be an upgrade), they would cost more than your average sausage but would be the best in the market 😊 However the said bangers may come with a large team of consultants to cook/configure them to your exact liking….. (no jokes about being burnt by Oracle that’s not funny)
Diversification is the Key
After calling my Oracle colleagues in the M&A department they confirm that sausages are off the menu unfortunately. However, they did point out we are doing some great things with IoT and AI in the farming market! One thing Oracle has done really well is to have a diverse portfolio and grown to a $40 billion business. So, what can smaller organisations take from this strategy?
Early M&A to Accelerate Growth
There are two traditional ways to build a company - organically or through M&A. I find there is a common misconception that M&A is only for large corporates. This is simply not true, VC’s like the proposition of a M&A strategy as often you are buying revenue streams plus a client base. There are many ways you can fund a M&A strategy with intelligent funding.
One solution is to acquire a complementary business – say if you were a Marketing Automation company an acquisition of a CRM provider would make sense. There would be a strong argument for having an integrated product plus you could sell into each other’s client base. Yes, it’s not easy there is culture fit to think about, funding and finding the right company. If you get it right, you will be able to accelerate your business faster than the organic approach.
I see many organisations not making the most of selling value added services. This sometimes comes with a cost base but if managed well should more than pay for itself. If you are a SaaS business I would strongly recommend you have a paid service offering. If you look at churn rates I see a lot of poor usage and adoption. When you delve deeper you can see the problems started at the implementation stage. This is a great strategy to get your customer services team to be revenue generating until you build up enough pipeline to have a dedicated delivery team. In a world of SaaS self-serve and online free onboarding having a paid services team can really add a USP to your sales pitch.
So in summary every business should consider a M&A strategy no matter what size you are. Use services to add an extra revenue stream, make your product stickier that will reduce churn rates. Add services to your sales pitch to give potential clients the confidence to buy your product.
If all else fails, there is always sausages…
Alex is an Entrepreneur, Sales Leader, Investor and International Speaker. Working at Oracle and sitting on the board of veneziacapital.com a technology based dynamic mid-market M&A and funding specialist.