By: Ronan Kennedy

 

In our first article, we focused on how founders can prepare for a successful exit by anticipating buyer needs and building with optionality in mind.

Preparing for M&A: How to Sell Your Company (Instead of Just Being Bought)

This second installment shifts focus to the acquirer. Whether you’re scaling into new markets, building out your product ecosystem or deepening your customer relationships, M&A can serve as a powerful, proactive tool to advance your long-term strategy. But success depends on more than identifying a target. It requires thoughtful planning, structured evaluation and a clear vision for how the acquisition will integrate with the company and create lasting value.

Below, we outline a practical approach to buy-side M&A—from identifying the right themes to structuring and integrating deals with intention.

 

Start with Strategy—Not Targets

The best M&A processes don’t start with a target list—they start with a clear vision. Where do you want your business to be in five or 10 years? What capabilities, markets, or scale will it take to get there? That strategic clarity helps turn an acquisition discussion from reactive and opportunistic to intentional and deliberate.

After developing the top-level corporate strategy, we advise companies to map the journey in three steps:

1. Take a Structured Approach to Get from Strategy to Target List
Strategy → Themes → Categories → Companies

• Themes: How could you achieve the strategic vision? Identify big bets—such as entering adjacent markets, expanding up or down the value chain or enhancing your solution suite.
• Categories: Break each theme into specific product areas or business models. What does the current product roadmap look like? How could this category improve or enhance the current roadmap? What makes one category more attractive than another? In what sequence should you pursue these categories?
• Companies: Identify key players in each category—some may be acquisition targets, but others will serve as reference benchmarks, or perhaps potential partners. Determine if one deal will suffice or if multiple will be needed to achieve your goals. This process helps leadership teams align around not just what they might buy, but why—and ultimately how everything fits into the broader vision and mission statement.

2. Leverage the Six Ms to Evaluate Each Opportunity
Once you’ve identified promising companies, assess them through a structured lens. We use the Six Ms—a simple but powerful framework to evaluate strategic fit and deal viability. Focus not just on the target, but on the potential of the combined business.

• Market – How does the acquisition reshape your market? Does it expand, consolidate, or deepen share-of-wallet? Is it a high-growth or more durable market—and is it core to your future growth?
• Management – Is the team strong—and potential future leaders within your organization? Are they looking to stay or move on? Do your styles align enough to work well together?
• Margins – How would this transaction change your gross and operating margins? Does cash burn increase/decrease? Are the unit economics attractive and sustainable?
• Monetization – How will the acquisition generate returns—and on what timeline? Will it drive more revenue from existing customers, unlock new markets, or strengthen pricing power and platform value?
• Moat – How does the acquisition deepen your competitive edge? Does it make you more essential to customers, enable pricing advantages, or offer clearly superior technology to alternatives?
• Mitigants – What are the risks of the transaction and implementation? How can those be reduced or avoided altogether?

At times, we apply a GPA-style grading system across the Six Ms, weighting each based on what matters most—such as talent in emerging sectors or defensibility in crowded markets. Pending corporate needs, you can more heavily weigh one category compared to another, creating a practical tool for aligning internally, guiding board discussions and pinpointing where a strategic premium or tailored deal structure may be justified.

3. Lead with Vision, Not Valuation
Discover → Design → Deliver

Approaching a company shouldn’t start with a number. It should start with understanding the product, clarifying the management team’s motivation and establishing a shared purpose. This is your discovery phase, where you’re learning as much as you can about the target.

The best acquirers start with questions—not term sheets:

• Do we share a vision? Are we tackling the same problem from different angles?
• Would joining forces make us stronger—and deliver more value to customers?
• What’s the right model: partnership, joint venture, or full integration under one voice?

Think of an acquisition more like a transplant than a transaction. Sometimes the host rejects the organ—other times, it’s the organ that rejects the host. Thoughtful planning helps reduce the risk of rejection from both parties!

We often suggest early collaborations or technical pilots to test fit before discussing deal terms. Customer overlap, joint go-to-market or shared infrastructure can reveal true alignment.

At the end of the day, acquisitions are human. Founders have dreams, teams have cultures and customers have choices.

 

Design for Flexibility

Once alignment is established, structure becomes the focus—and it’s here that acquirers can shape real outcomes. As you engage more deeply with the target, you’ll gain a clearer picture of the business: its financials, management team, customer base and product. The Six Ms will come into sharper focus, giving you the insights needed to determine whether to make an offer—and how to structure it.

Negotiations are often collaborative, with both sides surfacing priorities and pain points. As you consider the deal, be sure to address all three legs of the stool: the business purchase (and any future investment), the employment agreement and intangibles that could become deal-breakers if left unresolved. Understanding the other party’s motivations and constraints allows you to craft creative, joint-value solutions that preserve trust—and ensure long-term accretion.

Key structuring tools include:

• Cash vs. equity. Manage balance sheets, align stakeholders and offer future upside through thoughtful consideration of payment mix.
• Earn-ins. Commonly referred to as an “earn-out,” we prefer to position these options as an earn-in, enabling sellers to realize full value based on future performance. This helps align incentives and limit downside for buyers if promised conditions don’t materialize.
• Employment agreements. Identify critical talent and reflect retention priorities through compensation and employment incentive design. This could also include board governance for larger combinations.
• Tax-aware structuring. If the sellers are eligible for QSBS or other tax benefits, be considerate – as small adjustments in the proposed structure can unlock meaningful value to the founders.
• Intangibles. These can include important factors like branding, work/office location, org charts and reporting structures, titles, and even media releases to celebrate the successful acquisition.

 

Plan for Integration Before You Close

The biggest risk in M&A isn’t valuation—it’s successful integration. And too often, integration planning starts after the deal is signed.

At B Capital, we advocate for pre-merger integration, or “Pre-MI,” planning.  This involves scenario planning across several workstreams while deals are still being evaluated. Early integration thinking reduces execution risk, identifies obstacles and costs, aligns vision and ensures teams hit the ground running on day one to reduce the chaos of a merger.

Think through:

• Brand Identity: Will the target be rebranded, sub-branded, or remain independent? What best supports market positioning and value retention?
• Team Structure: Who will lead which functions post-close? How will reporting lines evolve, and when will changes to healthcare, retirement and other benefits be implemented?
• Communications: What’s the unified story we’ll tell customers, investors and employees—and when?
• Infrastructure: How will IT systems, product platforms and development roadmaps be integrated?
• Finance & Operations: How will accounting systems be consolidated? What’s the plan for managing expenses, vendor contracts, payroll and benefits?
• Integration Timeline: What’s the roadmap with key milestones across Day 0, Day 10, Day 100 and Year 1?

We bring in detailed pre-MI checklists and playbooks to help teams stress-test integration plans before they become roadblocks. This proactive approach not only accelerates value capture but also preserves momentum during the transition.

Many of these considerations also feed directly into the financial model—shaping both the economics of the merger and the unified vision for the combined business.

 

Driving Value Through Intentional M&A

M&A can be a powerful growth lever—but it’s also complex, time-intensive and high-stakes. Whether you’re a first-time acquirer or an experienced operator refining your strategy, choosing the right partner matters.

The best acquirers treat M&A as a strategic tool—not a reactionary process. They plan ahead, evaluate with discipline and integrate with intention. When done well, an acquisition doesn’t just accelerate your roadmap—it transforms your business, culture and position in the market. It can also open doors to new financing tools and investors who specifically support inorganic growth strategies.

Whether it’s your first deal or part of a broader strategy, success starts with early planning, clear alignment and a focus on the people who will ultimately be the source of delivering value.

 

 

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LEGAL DISCLAIMER
All information is as of 7.8.25 and subject to change. Certain statements reflected herein reflect the subjective opinions and views of B Capital personnel. Such statements cannot be independently verified and are subject to change. Reference to third-party firms or businesses does not imply affiliation with or endorsement by such firms or businesses. It should not be assumed that any investments or companies identified and discussed herein were or will be profitable. Past performance is not indicative of future results. The information herein does not constitute or form part of an offer to issue or sell, or a solicitation of an offer to subscribe or buy, any securities or other financial instruments, nor does it constitute a financial promotion, investment advice or an inducement or incitement to participate in any product, offering or investment. Much of the relevant information is derived directly from various sources which B Capital believes to be reliable, but without independent verification. This information is provided for reference only and the companies described herein may not be representative of all relevant companies or B Capital investments. You should not rely upon this information to form the definitive basis for any decision, contract, commitment or action.