Resources > Articles

Embracing Inorganic Growth

Post Author
  • Frank Tait is the director of product management at Frontline Technologies. He is a driven business leader with more than 20 years of senior executive experience in predictably and profitably growing innovative software products and services businesses in turn-around and high-growth situations. He can be reached at franktait@me.com.

Embracing Inorganic Growth

Many businesses with high valuations grow through a blend of organic growth and inorganic growth. The key is to find the right balance for your business and the markets that you serve and the right synergies with your acquisition targets.

The approach you use for organic growth can also apply to inorganic growth. Start with the market problem and market definition, which are the same regardless of growth type. Make sure to gain a clear definition of market segmentation and an understanding of buyer personas, including the business value these buyer personas will achieve by solving their problems.

It’s also important to understand the distinctive competencies of your company and those of your acquisition target. This information will be crucial in determining how to address post-close business integration.

The acquisition will bring customers, products, intellectual property and talent. You’ll need to evaluate each area separately.

Customers

You need a good sense of your cost to acquire a customer (CAC) and then compare the acquisition cost to the cost of winning these customers in the market and retaining those customers. The target company’s relationship with its customers is critical and tends to also reflect the level of talent.

Products

It’s important to assess how well the products solve market problems. Many target companies are not aware of the Pragmatic Institute model and don’t have anything like marketecture, which maps up problems to features. But if you plan to continue selling a product, you’ll need to quickly build out the marketecture as a prerequisite for marketing and sales planning.

Intellectual Property

Intellectual property acquisition—such as patents, copyrights and access to relationships that facilitate sales—tends to be pretty straightforward, but you’ll want to be clear about what you’re getting and the implications.

Talent & Acquisition

Talent is the acquisition wild card. People do business with people, and key industry and customer relationships are often dependent on individuals. Assessing the right people to retain is a combination of science and art that needs its own book. But it is essential to retain industry, domain, customer and product knowledge.

While all acquisitions at their core involve one business taking over another, there are often distinctly different strategic reasons behind the transition. To learn more, read the full article by Frank Tait in the latest edition of Pragmatic Marketer.

 

Author

  • Frank Tait is the director of product management at Frontline Technologies. He is a driven business leader with more than 20 years of senior executive experience in predictably and profitably growing innovative software products and services businesses in turn-around and high-growth situations. He can be reached at franktait@me.com.

Author:

Other Resources in this Series

Most Recent

interview
Article

The Eight Rules of Successful Win/Loss Analysis

Extracted from “The Reality of Perception: Aligning Your Buyer and Seller Process”
Successful Win/Loss Analysis
Article

Types of Data Needed for a Successful Win/Loss Analysis

It’s also essential to incorporate both quantitative data and qualitative data into your analysis. Let’s dive into the best practices for conducting a successful win/loss analysis.
PRIME Your Competencies
Article

What are Distinctive Competencies

PRIME can help identify strengths and weaknesses. Use it to focus organizational strategies as well as providing a focus for your career.
three white paper airplanes and one red paper airplane to showcase distinctive competencies
Article

Win/Loss: A Tool Used to Identify Your Company's Distinctive Competencies

Knowing which of your distinctive competencies are being recognized by the marketplace allows you to adjust your marketing and sales strategies.
Man holding elbow with tennis racket in hand
Article

[Distinctive Competency] What Companies Can Learn from the Tennis Elbow Queen

Focusing on an extremely specific segment of an industry can be a highly successful distinctive competency. Here are the lessons that companies can learn from the Tennis Elbow Queen.

OTHER ArticleS

interview
Article

The Eight Rules of Successful Win/Loss Analysis

Extracted from “The Reality of Perception: Aligning Your Buyer and Seller Process”
Successful Win/Loss Analysis
Article

Types of Data Needed for a Successful Win/Loss Analysis

It’s also essential to incorporate both quantitative data and qualitative data into your analysis. Let’s dive into the best practices for conducting a successful win/loss analysis.

Sign up to stay up to date on the latest industry best practices.

Sign up to received invites to upcoming webinars, updates on our recent podcast episodes and the latest on industry best practices.

Training on Your Schedule

Fill out the form today and our sales team will help you schedule your private Pragmatic training today.

Subscribe

Subscribe

Training on Your Schedule

Fill out the form today and our sales team will help you schedule your private Pragmatic training today.