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Post-Merger and Post-COVID Success in Tech Firms

Post-merger and post-COVID Comeback stories.

Over the past couple years, our work in tech due diligence has given us a unique vantage point. We’ve had the privilege of witnessing firsthand how various firms have responded, survived, and innovated through some of the most challenging times. Merging tech companies, the dreaded post-merger stage, often presents a host of difficulties, as does navigating a business during a global pandemic. However, some companies have managed to turn these challenges into opportunities, something that is both notable and commendable.

Decisive Leadership During COVID-19: A Key to Post-COVID Success in Tech

Good leadership is crucial during a crisis. Those who acted decisively during the COVID-19 pandemic stand out as examples for us all.

Tech Sector Resilience: Anonymous Success Stories in Post-Merger Scenarios

While I won’t divulge specific details, I can share the characteristics of some of the companies that have successfully navigated post-merger challenges and managed to grow despite adverse conditions.

  • Web3 Transition: This isn’t just about changing lanes; it’s about shifting the entire road map. The company we observed didn’t just adapt; they innovated, transitioning from manufacturing to virtual events. Their success was not just about resilience; it was about grasping the nettle and making a leap that got them prime-time TV coverage. This is a showcase of adaptability, innovation, and resilience in a rapidly changing market.
  • Revenue Growth Post-Merger: Starting from zero and scaling to $36 million in revenue in a mere 18 months is no minor feat. This particular company not only survived the complex process of a tech merger but thrived. They successfully merged tech teams and stacks, showing that with the right strategy and execution, you can grow exponentially even while integrating. We met this firm recently and was the inspiration to write about these comeback stories. We don’t give them enough credit during our assessment as our job is to take a cynical eye,
  • HealthTech Resilience: The pandemic led to a sudden surge in demand for health technology. The companies that impressed us didn’t just capitalize on this trend but maintained that high level of revenue even when the pandemic began to wane. This shows a degree of business acumen and adaptability that is nothing short of remarkable.

Strategies for Achieving Post-Merger and Post-COVID Success

There’s no universal playbook for excelling in challenging situations like mergers and pandemics. However, some key takeaways are applicable across scenarios:

  1. Quick Decision-Making: Essential for effective crisis management.
  2. Focus on Revenue: The bottom line matters and should be your guiding metric.
  3. Team Recognition and Reward: A crucial element in achieving sustained success.

Ultimately, during tech due diligence, what stood out in these management teams was a deep sense of mutual respect, which often proved to be more valuable than technical prowess alone. They’d all been ‘in it’ together and come out successfully on the other side.

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Hutton Henry
Hutton has worked with Private Equity Portfolio firms and Private Equity funds since 2015. Having previously worked in post-merger integration for large firms such as Ford and HP, Hutton understands the value of finding issues prior to M&A deals. He is currently the founder of Beyond M&A and provides technology due diligence for VC, PE and corporate investors, so they understand their technology risks before entering into a deal.

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