Next year is shaping up to be a very strong year for M&A activity in the Knowledge Economy. In order to assist your preparation for 2021, take a look at our M&A Preview, in which we discuss the following eight key trends:
- The adoption of digital is accelerating
- Emerging technologies are being commercialised rapidly
- There is a convergence across the sector and delivery models are blending
- Private equity participation in the knowledge economy is increasing
- Next-generation technology platforms are emerging
- Vertical software solutions are playing an increasing role
- Buyers are returning to nearshore locations for access to new skills
- Shareholders are aligning expectations and addressing structural risks
In our recent Consulting Services Trends Report, the Equiteq team outlines three M&A trends that will drive and shape M&A in the sector this year and beyond.
Here are the key takeaways:
Trend 1: Ongoing economic challenges
- Ongoing economic uncertainty will continue to act as a short-term dampener on M&A activity in the Consulting Services space during H1 2023
- Private Equity buyers still hold significant amounts of dry powder that needs to be deployed and their growing comfort with the Professional Services space will likely be a key driver of M&A activity
- Those consulting firms that invest in making an impact and can demonstrate how they enable success, will prove most attractive to buyers
Trend 2: Consulting & the Digital Transformation
- The cloud - and everything it enables - will remain a fundamental driver of M&A activity in the Technology Services space during 2023
- To stay relevant and maximize delivery impact, it is essential for Management Consultancies to keep investing in learning about emerging technologies and the talent that understands them
- Specialized consulting that can enable Digital Transformation is most in demand in the healthcare, life sciences, engineering, and finance sectors
Trend 3: Sustainability & ESG Consulting
- Specialized consulting in areas such as ESG and sustainability is becoming increasingly attractive to buyers and this will only be accelerated by evolving regulatory environments
- Private Equity are a major buyer subset, with a growing number of specific funds being set-up to execute long-term buy-and-build strategies in the sustainability space
- Although in the ascendancy, the sustainability consulting space is still relatively young and remains unconsolidated, with few clear market leaders
For more in-depth commentary on these three trends, download the Consulting Services M&A Report. If you'd like to speak directly to one of our M&A experts about the future of your business, email us now.