M&A Strategy Framework

M&A PHILOSOPHY

Why Companies Pursue M&A

M&A FUNDAMENTALS

WHY M&A (AND WHY NOT):
☐ M&A accelerates what you can't build fast enough
☐ M&A creates value when 1+1>2
☐ M&A destroys value when 1+1<2
☐ Most acquisitions fail (50-70%)
☐ Success requires rigorous discipline

LEGITIMATE M&A RATIONALES:
☐ Access new markets (geographic/segment)
☐ Acquire technology you can't build
☐ Acqui-hire exceptional talent
☐ Eliminate competitor/gain share
☐ Achieve cost synergies at scale
☐ Enter adjacent business

WARNING SIGN RATIONALES:
☐ Revenue growth "easier" than organic
☐ CEO wants to do a deal
☐ Bankers bringing opportunities
☐ FOMO on consolidation
☐ Escape core business problems

M&A SUCCESS FACTORS:
☐ Clear strategic rationale
☐ Rigorous target evaluation
☐ Disciplined pricing
☐ Thorough due diligence
☐ Excellent integration planning
☐ Post-merger execution

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M&A STRATEGY

Comprehensive M&A Strategy Framework

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M&A STRATEGY FRAMEWORK
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SECTION 1: STRATEGIC RATIONALE

WHY ARE WE PURSUING M&A?
Primary rationale: _______________
Secondary rationale: _______________

RATIONALE VALIDATION:
☐ Can we achieve this organically? How long?
☐ What's the opportunity cost?
☐ Do we have integration capability?
☐ Is now the right time?
☐ Do we have capital/currency?

STRATEGIC FIT CRITERIA:
Must-haves:
☐ _________________________________
☐ _________________________________
☐ _________________________________

Nice-to-haves:
☐ _________________________________
☐ _________________________________

Deal-breakers:
☐ _________________________________
☐ _________________________________

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SECTION 2: TARGET CRITERIA

FINANCIAL PARAMETERS:
Revenue: $_____ to $_____
Growth rate: ___% to ___%
Gross margin: >___%
ARR/recurring: >___%
Profitability: _______________
Valuation range: $_____ to $_____

STRATEGIC PARAMETERS:
Market segment: _______________
Geography: _______________
Customer overlap: _______________
Product fit: _______________
Technology fit: _______________

RISK PARAMETERS:
Maximum customer concentration: ___%
Minimum team retention confidence: ___%
Maximum integration complexity: ___
Regulatory risk tolerance: ___

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SECTION 3: SEARCH STRATEGY

APPROACH OPTIONS:
☐ Proactive outreach (CEO/Corp Dev led)
☐ Banker-led search (retained)
☐ Network referrals (board, investors)
☐ Inbound interest (reactive)
☐ Competitive process monitoring

SEARCH SOURCES:
☐ Known companies (target list)
☐ Investment banker pipelines
☐ Industry conferences
☐ Competitor tracking
☐ Customer suggestions
☐ Employee referrals

DEAL FLOW GOALS:
Targets identified: ___/quarter
Initial conversations: ___/quarter
LOIs signed: ___/year
Deals closed: ___/year

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SECTION 4: CAPABILITY ASSESSMENT

M&A CAPABILITY CHECKLIST:
☐ Corp Dev lead assigned
☐ M&A playbook documented
☐ Due diligence team identified
☐ Legal support (internal/external)
☐ Integration leadership designated
☐ Board M&A framework approved
☐ Capital available/accessible

EXTERNAL SUPPORT:
Investment bank (M&A advisor): _______________
M&A legal counsel: _______________
Financial DD provider: _______________
Technical DD support: _______________
Integration consultant: _______________

M&A Decision Matrix

Factor	Weight	Target A Score	Target B Score	Notes
Strategic fit	25%	/10	/10
Financial return	20%	/10	/10
Integration risk	20%	/10	/10
Cultural fit	15%	/10	/10
Team quality	10%	/10	/10
Timing/market	10%	/10	/10
WEIGHTED TOTAL	100%	/10	/10

M&A Pipeline Tracker

Target	Stage	Strategic Fit	Valuation Est	Next Step	Owner
	Identified	/10	$__M
	Conversation	/10	$__M
	DD	/10	$__M
	Negotiation	/10	$__M

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