Bluebox Technology Report

June 3, 2021

In a recent Bluebox LinkedIn poll, we asked our followers “if you were given £500k to invest in a company, what sector would it be in?”. The outcome, by an overwhelming majority, was ‘Technology’. You might not be surprised to hear that many market commentators would be inclined to agree…

 

Despite the adverse impact the global pandemic has had on countless sectors, ‘Technology’ has been a one that has been adversely affected (generally speaking) to a lesser degree. With many businesses adjusting their operating models to become more flexible, SaaS-based offerings like Zoom and ‘the cloud’ have become engrained into everyday life – even if “you’re on mute” is still frequently said! Consequently, there has been a significant increase in demand from both businesses and consumers for these types of solutions.

 

Whilst we now appear to be slowly returning to ‘normality’, it is expected that a lot of these new ways of working and living are here to stay. If anything, it is said that the global pandemic spurred on technological advancements that would have occurred at some point in the future any way.

 

What this means is that there is a requirement for many businesses across a variety of sectors to pivot, so not to be left behind the pack. While they may be able to do this organically, we are seeing more and more turn to M&A as a means of bolting on new capabilities. In addition, there are inevitably many technology businesses that have been unable to withstand the trials and tribulations of the last fourteen months or so, providing others with opportunistic deals.

 

With the shifts we have seen in both business and consumer behaviours, it is not surprising that tech has never been such an attractive sector for deal makers, which is evidenced by the valuations some of these businesses are trading at. Whether these valuations are true or inflated remains yet to be seen, however, it can be said that 2021 certainly looks like it will be another bumper year for M&A in Technology.

 

As the Technology sector sees no signs of slowing down, now is as good a time as any to explore the market. If you are thinking about either fundraising or selling your business, we would be delighted to arrange an informal meeting (over Zoom or Teams) to discuss your options in more detail.

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