M&A MARKET STRONG DESPITE IPO EXCITEMENT

Boston-based investment bank Revolution Partners, is promoting a “back-to-basics” approach to finding success in the current technology deal market, seeing M&A playing an important role for companies looking for options.

“The allure of an IPO is very different than the M&A process,” said Peter Falvey, co-founder of Revolution Partners. “But despite the few high profile public offerings we’ve seen in the marketplace, a merger or acquisition is still the exit of choice for most middle-market technology companies.”

With a continued focus on regulatory changes under the Sarbanes-Oxley Act (SOX), and the growing emphasis on Director’s and Officer’s (D&O) Insurance, boutique investment banks such as Revolution Partners are finding interest among buyers and sellers.

“Some sanity has finally returned to the M&A market,” said David Lavallee, co-founder of Revolution Partners. “It is clear that companies are aggressively pursuing deals again, while also suggesting there is hope on the valuation side. It’s really about profits, growth and execution.”

Solid management and strong earnings potential are key catalysts, said Lavallee, indicating the importance of “doing your homework” before approaching potential partners, while also being able to articulate how the deal is beneficial to both sides.

“The bottom line is finding common ground to get a deal done,” said Lavallee. “Each deal must be handled on a case-by-case basis, but there is never a substitute for understanding an industry and its appetite for your product.”