M&A Market Outlook (Q4 2024)
Our founder James Creech was featured in They Got Acquired’s Q4 2024 M&A market outlook. Here are his answers about the current state of the M&A market in digital media, tech, and the creator economy:
1. What's the market like right now: Q4, 2024?
We focus on digital media, technology, and the creator economy, all of which have been pretty active M&A markets this year. There's a big push in Q4 to finalize deals that have been in process from earlier in the year, so we expect a few more closings before the holidays. New deals, however, will likely kick off in January as buyers otherwise spend Q4 delivering against EOY sales targets and finalizing 2025 budgets.
2. How does the market this year compare to last year?
Overall activity is up this year compared to last year, at least in our markets.
3. Is the M&A market hot for any types of businesses in particular? Is there anything in particular buyers are looking for?
We're seeing a lot of interest in influencer marketing agencies and talent management firms as those markets continue to consolidate. Both strategic and financial buyers are particularly interested in companies with meaningful operating history (5+ years), consistent growth (20%+ YoY), and profitability (15% - 20%+ EBITDA).
4. Are there any types of businesses you're seeing struggle to sell? Can you share more about that?
Buyers seem to be particularly cautious around businesses with higher risk profiles, e.g. heavy customer concentration or platform dependency considerations. Such risks can often be mitigated through deal structure, but many buyers have been unwilling to engage with what they perceive to be 'riskier assets,' even if those businesses have solid fundamentals and are exhibiting strong growth.
5. What do you think next year (2025) will bring for M&A?
We expect to see even more M&A activity next year, as we enter a lower interest rate environment and get past the chaos and uncertainty of an election year.
6. Anything else you think is important?
The sellers who achieve the best outcomes are typically those who are the most prepared. We recommend getting organized for an M&A process about 12 months in advance to make sure you know what to expect and can deliver strong results throughout the process.
