Data Analytics Consulting Global M&A Review 2019

By Ramone Param, Director, Equiteq

We have released a summary of our detailed review of data analytics consulting M&A and investor trends for owners of businesses across the knowledge economy.

At the core of the Fourth Industrial Revolution is the fusion of big data, advanced analytics and new physical technologies. The key to business success in the new digital age is no longer being able to simply use data to measure current and past performance. It is being able to make predictions about the future and quickly prescribe recommended strategies that can enrich decision making.

From a delivery model perspective, there is pressure on knowledge-intensive services firms to enhance their consulting offering with new data analytics solutions. This same pressure is being felt by consulting firms’ clients, who look to their advisers for assistance in innovating and realizing competitive advantages from new data analytics tools. Across the space in 2018, we found that buyers focused on acquisition targets with proprietary platforms, leverageable IP and managed services solutions.

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The Knowledge Economy Global Buyers Report 2018/19

Strong demand for M&A in 2019 is driven by industry convergence with a desire among buyers to deepen industry and digital expertise

By Ramone Param, Director, Equiteq

  • Buyers expect to complete 5 acquisitions over the next 2 to 3 years
  • Private equity expect to acquire 75% more businesses than strategic buyers
  • The optimum turnover size for an acquisition rose 18% since 2016
  • Strong demand for artificial intelligence, data analytics and Internet of Things capabilities

The Knowledge Economy Global Buyers Report analyzes the findings of our fifth comprehensive independent survey of global strategic buyers and private equity investors acquiring businesses across the knowledge economy. The report provides exclusive insights into current M&A trends among buyers that acquire knowledge-intensive services businesses across five segments: management consulting, IT services, media agencies, engineering consulting and human resources.

The following summarizes the main trends discussed in more detail in our recently published Knowledge Economy Global Buyers Report.

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Top 10: What you were reading in 2016

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Welcome back to Equiteq Edge. A new year brings new opportunities for a fresh start. So, as you return to work after an indulgent festive break, we thought we’d provide a quick summary of some of the important things we’ve learnt over the course of 2016 – and that you can apply in the year ahead.

Here’s a list of the most read blogs of 2016.

  1. Sales and profit growth (Part 1): We discussed the importance of revenue and profit, how much marketing you should do and whether an earn out is a given.
  1. Sales and profit growth (Part 2): We covered client concentration, minimum revenue levels and new revenue models in the second part of our sales and profit special.
  1. Does your consultancy have a real value proposition?: Your consultancy’s value proposition is an essential part of its success.
  1. Why equity incentivizing your senior team can improve equity value: Awarding shares (or options) to the right people in the right proportions is one of the most powerful tools at the founding shareholders’ disposal.
  1. Nurturing client relationships to support equity value growth: Client relationships are at the heart of a consultancy’s growth, but they are not all created equal.

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Equiteq Deal Insight: Digital Media Consulting

Dentsu to acquire majority stake in Merkle, gaining market-leading capabilities in customer-focused data analytics & performance marketing

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In our 2016 Global Consulting M&A Report, we observed that last year’s media buyers were dominated by a few large players, with one of the key drivers for acquisitions being their motivation to keep ahead of the competition within the context of a rapidly changing industry. This industry transformation is being led by the digital disruption of business models, particularly as it relates to how companies interact with their customers.
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This week, Dentsu Aegis Network, the international arm of one of last year’s top three media buyers, announced their acquisition of a majority stake in Merkle. Merkle is considered to be the largest independent U.S.-based agency focused on customer relationship management and search, managing a vast dataset of first-party customer records. Merkle is also one of Google’s largest agency partners and was one of the first agencies to offer custom audience data relating to Facebook.

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