"Change is the law of life. And those who look only to the past or present are certain to miss the future." — John F. Kennedy
Have you ever seen so much change? Business owners are still adapting to the headwinds, while savvy buyers are seizing opportunities. The second half of the year will be a dynamic period again, with many factors in play. Here's a rundown of key trends in online business M&A for the upcoming months.
1. Macroeconomic Environment
Interest Rates and Inflation
Interest rates and inflation are not just news headlines, these hot topics have found their way in the Flippa Deal Room with buyers citing uncertainty and sellers talking up their resilience. While the sentiment has mainly impacted smaller deals on the platform, there's a silver lining across the board. Businesses with strong cash flows might find acquisition opportunities as competitors struggle with higher costs. We are seeing more business owners talk about acquisition as the best pathway to near term growth. If you're interested in synergistic deals, fill out our Deal Origination form.
Economic Recovery and Consumer Confidence
Investor confidence, following the tech downturn, is still uncertain. At Flippa, we gauge investor sentiment by net new investor / buyer mandates, search data and deal numbers. Here are the top search terms by business model:
- Shopify (Ecommerce): 18,336 searches
- Adsense (Content & Publishing): 15,356 searches
- Blog (Content & Publishing): 14,876 searches
- Amazon (Ecommerce/KDP): 9,698 searches
- SaaS (SaaS): 9,457 searches
Top category searches include:
- Travel: 9,680 searches
- AI: 7,843 searches
- Pets: 6,122 searches
- Fitness: 6,099 searches
- Health: 5,817 searches
For more on buyer liquidity, check out Flippa’s Insights service.
Or, to browse the latest buyer mandates, check out the new Buyer Directory.
2. Technological Advancements
AI and Automation
AI and automation businesses are hot commodities. If you have an AI app or solution with real traction, get in touch with our broker team for introductions to strategic buyers. Meet the brokers here.
3. Market-Specific Developments
Google and Apple Privacy Changes
Data privacy changes, like Apple's ATT framework and Google's Privacy Sandbox, are reshaping digital advertising. Businesses that navigate these changes well, maintaining strong customer engagement and data practices, are becoming more valuable.
Amazon FBA and Fee Changes
Amazon's new inbound placement service fee for FBA sellers are significant. Sellers need to be strategic with how they think about cost management to stay attractive in the M&A market. Adapting quickly will be key. Given the huge buyer demand for D2C Ecommerce businesses right now, think about diversifying your business.
4. Financial Strategies and Buyer Behavior
Private Equity and Strategic Buyers
Private equity firms are more active in small business M&A, targeting companies with growth potential and stable cash flows. Strategic buyers seek businesses that offer synergies or fill gaps in their portfolios. We’ve just launched a Buyer Directory to help connect buyers and sellers. Check it out here.
Valuation and Deal Structures
With economic uncertainties, buyers and sellers must agree on valuations. Earn-outs and contingent payments are becoming more common to bridge gaps and align incentives. H1 multiples have adjusted slightly, reflecting overall higher-quality assets.
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