The healthcare revenue cycle management (RCM) sector is experiencing record merger and acquisitions (M&A) activity. At VERTESS, we are seeing private equity firms and strategic acquirers aggressively pursuing acquisitions of RCM companies big and small, with increased interest in those companies that offer artificial intelligence (AI)-driven automation, scalable technology, and strong financial performance. As healthcare providers struggle with rising administrative costs, payer rules, and increased patient financial responsibility, there is heightened demand for efficient, technology-enabled RCM solutions.
For healthcare RCM business owners considering an exit, 2025 presents a prime opportunity to sell at what could be a premium valuation. However, not all RCM businesses are equally attractive to buyers. The most valuable companies are those with qualities like recurring revenue, automation-driven efficiencies, a diverse client base, and strong earnings before interest, taxes, depreciation and amortization (EBITDA) margins.
Whether you're looking to sell your RCM business in the next 12-24 months or want to position it for future growth, understanding the current market and what buyers are looking for are essential.
Overview of the Healthcare Revenue Cycle Management Market
Over the past several years, the healthcare RCM market has experienced significant consolidation, and there's no indication this momentum will slow down soon. Consolidation is being driven by a variety of factors, such as increased financial pressures on healthcare providers and a shift toward technology-driven solutions. The ongoing complexity of reimbursement, rising out-of-pocket costs, and administrative inefficiencies are among the reasons that have elevated demand for automation, interoperability, and outsourced RCM services.
Private equity and strategic acquirers have increasingly focused on business-to-business (B2B) RCM solutions while largely avoiding direct-to-consumer healthcare segments, as these have struggled more with inflation coupled with consumer spending challenges. The B2B RCM market has experienced strong M&A activity, with the middle market attracting competitive valuations and a record number of private-equity-led platform acquisitions.
5 Key Trends Driving Healthcare RCM M&A Activity
Here are five of the trends that we're seeing as significant factors contributing to the elevated interest in healthcare RCM companies.
1. AI and automation reshaping RCM It's clear that the adoption of AI and automation is transforming the RCM landscape, with 98% of healthcare organizations indicating they have implemented or are planning to implement AI strategies to enhance efficiency and financial performance. AI-powered automation has become more integral to coding, claims processing, and eligibility verification, significantly reducing manual errors and administrative burdens.
The increasing reliance on AI has driven a surge in RCM M&A activity, with AI-driven RCM transactions representing 21% of deals in early 2023, compared to 11%-12% in prior years. Major acquisitions highlight this trend, including CloudMed's $4.1 billion acquisition by R1 RCM, with CloudMed having optimized reimbursement workflows using AI, and Apixio's acquisition by New Mountain Capital, with Apixio having leveraged AI-powered risk adjustment and analytics to improve financial outcomes.
2. Private equity firms leading the RCM buyout boom Private equity firms are the dominant force in healthcare RCM M&A, with nearly half of healthcare information technology (IT) transactions in 2024 involving private equity buyers. This figure marks a 20% year-over-year growth. Investors are aggressively pursuing buy-and-build strategies, acquiring smaller, specialized RCM firms and integrating them into scalable platforms to enhance value.
Noteworthy transactions include Francisco Partners' $1.1 billion acquisition of AdvancedMD, which expanded its cloud-based practice management and RCM software capabilities, and Petal Solutions' acquisition of Medcom Billing Systems, which strengthened its medical billing automation portfolio. Additionally, Elevate Patient Financial Solutions, backed by Edgewater and Frazier Healthcare, acquired NYX Health Eligibility Services, reinforcing its Medicaid-focused RCM solutions.
3. M&A valuations remain strong RCM companies continue to command high valuations, particularly in the middle market, where competition among investors is fierce. From 2021 to 2024, the average enterprise value (EV)/revenue multiple for RCM deals reached 6.1x, significantly outpacing the 4.4x average from 2018 to 2020. The middle market — transactions under $500 million — has been particularly active, making up more than 80% of sector deals in 2024 as both private equity firms and strategic acquirers compete for companies with highly desirable qualities like recurring revenue models, scalable technology, and strong contract structures. The combination of predictable cash flows and growing demand for AI-driven automation has positioned healthcare RCM as one of the most sought-after healthcare IT investment categories.
4. Consolidation of RCM technology firms The healthcare RCM market remains highly fragmented. This provides a strong M&A pipeline for platform acquisitions and roll-up strategies. Large healthcare IT vendors are actively acquiring RCM firms to integrate AI, automation, and risk adjustment tools into their solutions rather than building in-house capabilities. Industry leaders, such as Waystar, R1 RCM, and Epic, are expanding their product offerings in an effort to enhance revenue cycle efficiency and reduce administrative complexity. The scale of consolidation is further evident in Clayton, Dubilier & Rice and TowerBrook Capital Partners' $8.9 billion take-private acquisition of R1 RCM. This deal reinforced the attractiveness of end-to-end RCM platforms.
5. B2B healthcare RCM platforms outperforming direct-to-consumer healthcare IT As referenced earlier, B2B healthcare RCM platforms have become the preferred investment target compared to direct-to-consumer healthcare IT. B2B healthcare IT transactions accounted for about 72% of total sector deals in 2024, reflecting a more than 24% year-over-year increase. In contrast, direct-to-consumer healthcare IT companies (e.g., telehealth providers) saw a nearly 29% decline in deal volume due to issues including market saturation and economic pressures.
Private equity and strategic acquirers are prioritizing B2B RCM vendors with qualities like high customer retention, scalable software, and mission-critical revenue cycle capabilities. The shift toward enterprise-focused, technology-driven revenue cycle solutions reflects broader trends in healthcare IT, where automation, interoperability, and financial optimization are paramount.
5 Key Focus Areas for Healthcare RCM Business Owners Preparing for an Exit in 2025
Now let's look at five areas healthcare RCM business owners should focus on if they are planning for or considering a sale of their company this year.
1. Strengthening recurring revenue and contract stability Buyers, especially private equity firms and strategic acquirers, prioritize healthcare RCM businesses with predictable, recurring revenue streams and long-term client contracts. Owners should work to secure multi-year contracts with providers, payers, and health systems as this will help demonstrate revenue stability. Reducing customer churn and increasing contract renewal rates will enhance valuation and make the business even more attractive to investors. In addition, implementing tiered pricing models, value-based pricing, and/or bundled service agreements can further solidify revenue predictability and enhance the appeal of the company.
2. Investing in AI and automation for operational efficiency With AI-driven automation playing an increasingly pivotal role in healthcare RCM M&A, owners should be working to ensure their business integrates the likes of AI-powered coding, claims processing, and denial management solutions. We are seeing investors being particularly drawn to scalable, tech-enabled RCM platforms that improve financial outcomes for providers.
Partnering with companies that offer solutions or developing AI-enhanced revenue intelligence tools can differentiate the business while improving EBITDA margins, which will then increase deal value. Companies lacking AI capabilities may struggle to compete in a market where automated, data-driven decision-making is quickly becoming the standard.
3. Expanding market reach and diversifying client base Client diversification reduces risk and increases buyer appeal. Owners should look for ways to expand into high-growth verticals like behavioral health, dental, ambulatory surgery centers, dermatology, and physical therapy, where RCM services are in demand. Reducing client concentration risk — where a few large customers contribute to a disproportionate share of revenue — will be critical in maximizing valuation.
Additionally, broadening payer mix to include commercial insurance, Medicare, Medicaid, and value-based care arrangements can strengthen revenue resilience. Healthcare RCM businesses that serve a diverse client base across multiple provider specialties and geographies tend to attract stronger acquisition interest and achieve elevated multiples.
4. Optimizing financial performance and profitability Potential buyers closely evaluate key financial metrics like gross margins, EBITDA, and revenue growth trends. RCM business owners should focus on improving their cash flow efficiency, reducing days sales outstanding (DSO), and increasing clean claim rates to enhance financial performance. Streamlining internal operations through automated billing, outsourcing non-core functions, and implementing AI-driven collections processes can drive margin expansion.
5. Building a strong management team and scalable infrastructure Investors look for businesses with experienced leadership teams and scalable infrastructure that can support rapid growth post-acquisition. Healthcare RCM owners should invest in hiring (if needed) and retaining top RCM talent, strengthening their compliance teams, and ensuring strong leadership succession plans are in place. A well-prepared management team with clear growth strategies and efficient back-office operations will increase buyer confidence and valuation.
Additionally, maintaining a robust technology stack with interoperable solutions that integrate easily with electronic health record (EHR) systems, payer platforms, AI tools, and other solutions will improve operational scalability.
As M&A activity in the healthcare RCM sector continues to surge, business owners who proactively position their companies for an acquisition will have the greatest opportunities for a profitable exit. Whether you're looking to sell now or in the next few years, the key to securing multiple, realistic offers for your company and maximizing valuation is ensuring that your business meets the criteria today's investors are actively seeking — from AI-driven efficiencies and revenue stability to strong EBITDA and a scalable management team.
At VERTESS, we work exclusively with healthcare business owners to help them strategically prepare for an exit, negotiate the best possible deal, and achieve a successful and smooth post-transaction transition. Our deep relationships with private equity firms, healthcare IT investors, and strategic acquirers allow us to connect healthcare RCM company owners with the right buyers at the right time — better ensuring that they receive the highest valuation for their business.
Additional sources: Pitchbook, Bain and Co.
Jack Turgeon, MBA
As a Managing Director at VERTESS, I bring extensive experience in sales, consulting, and project management from early-stage startups. With an MBA from Babson College, I have a strong foundation in business strategy, operations, and financial analysis. My personal connection to behavioral healthcare through a family member motivates me to help business owners get the best deal possible while ensuring high-quality care for their clients. Throughout the M&A process, I provide comprehensive support at every step. I have a proven track record in negotiations and client management after working with companies in various industries. I’m excited to join VERTESS and make a meaningful impact on the lives of the owners I work with.
We can help you with more information on this and related topics. Contact us today!
In recent years, we have seen healthcare information technology (IT) companies emerge as a leading investment focus for private equity. Healthcare IT has showcased resilience and steady growth even as other healthcare sectors, like healthcare services, faced evolving regulatory challenges. While Healthcare IT faces its own set of regulatory hurdles — especially around data security, interoperability, and compliance — these differ from the direct care and reimbursement complexities that healthcare services providers confront.
As owners of healthcare IT companies consider their strategic plans for 2025, I believe they have a unique opportunity to consider lucrative exit strategies and other mergers and acquisitions (M&A) opportunities, driven by strong and rising interest from investors who recognize the substantial value of digital transformation in healthcare.
Why Buyers Are Targeting Healthcare IT Businesses
The interest in healthcare IT companies from private equity firms and others stems from the long-term customer relationships and "stickiness" of software platforms, especially in mission-critical areas like revenue cycle management (RCM), quality of care, and provider productivity applications. The ongoing digital transformation in healthcare, coupled with a rising demand for analytics and interoperability, positions healthcare IT companies as high-value targets with scalable revenue potential.
Historically, the lower-middle market in healthcare IT was less attractive to private equity due to the dominance of venture capital investors and a focus on growth at all costs over profitability. However, as fundraising becomes more challenging, companies are shifting to scale with profitability in mind, aiming for cash-flow-positive models. We have seen this shift spur a rise in venture-backed, lower-middle-market software transactions, creating new M&A opportunities for companies that previously had limited exit and partnership options.
Attractive sectors in healthcare IT include RCM, predictive analytics, value-based care, and niche-focused healthcare solutions. RCM platforms are among the most sought-after targets, with significant deal flow driven by the outsourcing of complex billing and coding tasks. Despite some consolidation in recent years, this market remains highly fragmented, offering further consolidation opportunities for private equity, while the long-term relationships these platforms foster enhance scalability and investment appeal.
With the rise of value-based care, platforms centered on financial efficiency, data-driven decision-making, and outcome improvement — such as clinical analytics, care coordination, remote patient monitoring (RPM), and point-of-care decision support tools — are experiencing elevated activity. Tools leveraging artificial intelligence (AI), machine learning, and real-time data integration are particularly scalable across various healthcare settings, making them especially attractive to investors.
Software products focused on specific niches within healthcare are also drawing premium valuations due to their high demand. With barriers to entry and limited competition, these specialized products often establish moats through customer retention and long-term contracts, making them ideal tuck-in acquisitions for larger platforms. Examples include ambulatory electronic health record (EHR) and practice management solutions tailored to specialties like dermatology and ophthalmology, which offer highly specific workflows and patient engagement tools that drive operational efficiency and improved outcomes. Products focused on chronic disease management, such as hypertension- and diabetes-focused RPM, also align well with value-based care models.
Why This Matters for Healthcare IT Business Owners
Private equity interest in healthcare IT companies is driving higher valuations, especially in the sectors outlined above, enabling many owners to achieve attractive multiples when they bring their company to market. Selling to investors that understand the strategic value of specialized software allows for smoother integration into larger platforms, enhancing scalability and impact. Owners can also benefit from flexible exit options, including minority buyouts, majority recapitalizations, earnouts, equity rollovers, and ongoing roles within the acquiring platform, offering various paths to a successful transition.
For Healthcare IT business owners considering a future sale, taking steps now to strengthen and streamline operations can lead to a more attractive valuation and smoother transaction process. Start by ensuring that financial records and key performance indicators (KPIs) are transparent, accurate, and readily accessible. Clear visibility into revenue streams, customer retention rates, and cost structures is essential for attracting potential buyers.
Additionally, focus on reinforcing your platform's scalability and interoperability to align with industry demands for flexible, integrative solutions — features highly valued by private equity and strategic investors. It's also wise to address regulatory compliance proactively, particularly around data security and interoperability standards, as these are increasingly scrutinized in due diligence.
Finally, consider solidifying long-term contracts and deepening relationships with clients. Long-term customer retention enhances the perceived stability and profitability of the business. By preparing these elements now, you'll be well-positioned to capitalize on the favorable market trends when the right opportunity arises.
Maximizing Value in Healthcare IT M&A: Why Founders and CEOs Should Trust VERTESS
At VERTESS, we bring unparalleled expertise and a deep understanding of the healthcare IT sector to every M&A engagement, helping clients achieve the highest possible valuation and a smooth, successful exit. Selling a business is more than just a transaction — it's the culmination of years of hard work and growth. We recognize these efforts and take a personalized approach to transaction engagements, working closely with each client to understand their goals and develop a strategy that highlights the unique value of their company. Our process begins by identifying the ideal target buyer groups, whether they are private equity firms, strategic acquirers, or other specialized investors. With our extensive network, we connect owners with buyers who appreciate the strategic value of their business and are invested in maximizing its future growth potential.
We also excel in crafting a compelling narrative that showcases each company's strengths. By collaborating with clients to emphasize scalability, revenue potential, and competitive advantages, we ensure their business stands out in a crowded market and attracts top-tier buyers. From structuring the deal to navigating due diligence and handling negotiations, VERTESS provides comprehensive support at every step, anticipating and addressing potential challenges to keep the process on track. Our expertise ensures that every detail is managed with precision and care, giving clients the confidence that they're positioned for success.
With private equity attention intensifying and valuations on the rise, now is an ideal time for healthcare IT business owners to consider their exit options. Partnering with seasoned advisors like VERTESS can simplify the M&A process and unlock the full potential of an exit. This will help ensure owners are well-positioned to capitalize on today's healthcare IT market opportunities while preserving the legacy of their healthcare IT businesses.
Jack Turgeon, MBA
As a Director at VERTESS, I bring extensive experience in sales, consulting, and project management from early-stage startups. With an MBA from Babson College, I have a strong foundation in business strategy, operations, and financial analysis. My personal connection to behavioral healthcare through a family member motivates me to help business owners get the best deal possible while ensuring high-quality care for their clients. Throughout the M&A process, I provide comprehensive support at every step. I have a proven track record in negotiations and client management after working with companies in various industries. I’m excited to join VERTESS and make a meaningful impact on the lives of the owners I work with.
We can help you with more information on this and related topics. Contact us today!
Private equity often carries a negative connotation in the healthcare industry. However, if you are considering selling your business, it's crucial to understand the impact private equity has on the overall deal market and the sale of your company. At VERTESS, we focus exclusively on transactions in various healthcare sectors. By tracking the activity of private equity groups, or PEGs, we gain insights into the current market dynamics, allowing us to better advise our clients on what to expect when selling their businesses.
In this column, we will briefly define private equity, then dive into the influence of it on the sale of healthcare businesses, current trends in healthcare private equity activity, and what business owners should consider when planning to sell their companies.
What Is Private Equity? Private equity is an alternative investment strategy that allows institutional and accredited investors to invest in private markets. These groups invest in private businesses to increase their value over a holding period — one typically lasting 5 to 7 years. PEGs have an ultimate goal of selling the businesses for a profit.
One strategy for increasing the value of these portfolio companies is through mergers and acquisitions (M+A), where companies consolidate multiple businesses under a single entity. By acquiring regional and national competitors or businesses with synergistic lines, these portfolio companies can add revenue and earnings, thereby increasing their value when sold.
What Influence Does Private Equity Have on Selling Your Healthcare Business?
Why is private equity important for business owners? When you decide to sell your healthcare business, you will likely receive offers from multiple entities, potentially including private equity-backed portfolio companies and private equity funds. Tracking their activity in the market can help you understand what to expect when selling your business. While private equity groups are not the only buyers in the market, knowing how they acquire and invest in companies provides valuable insights into the market as a whole.
Where Things Stand: A Closer Look at Private Equity Activity in 2024
In 2023, M+A activity was sluggish across most sectors and especially in healthcare. High interest rates lowered business valuations, creating a gap between owners' expectations and buyers' valuations.
In the first half of 2024, private equity showed signs of recovery in the global M+A market. After a slow start, private equity deal activity increased, stabilizing its market share and alleviating concerns about private equity's role in the anticipated M+A rebound. Exit activity, crucial for healthcare industry growth, improved significantly after a long period of stagnation, elevating fundraising and capital availability for future investments.
Private equity fundraising exceeded expectations, showcasing the healthcare industry's resilience and continued investor confidence, despite an anticipated slowdown in the latter half of the year. Middle-market funds performed well, in contrast to the more challenging environment for megafunds.
As the stock market includes more smaller cap stocks, private equity valuations and exit opportunities are expected to improve further. The healthcare industry's adaptability and forward momentum amid challenging conditions highlight its potential for continued growth and success.
Looking at the more recent quarter of 2024 (Q2), healthcare private equity activity showed promise despite a lighter quarter overall. The healthcare sector accounted for a substantial portion of deal activity, with numerous transactions reflecting strong down-market deal flow. Notable deals included Cotiviti's recapitalization by KKR and Veritas and Thomas H. Lee Partners' acquisition of Agiliti, indicating ongoing interest in healthcare investments. Healthcare services dominated private equity deals, while pharma services also attracted significant interest, with multiple platform deals closing.
The demand for weight-loss drugs sparked interest in peptide manufacturing, aligning well with private equity's focus on consistent business models. Despite high valuations and economic uncertainties, the healthcare sector remains robust for private equity investment, driven by strategic acquisitions and divestments.
In conclusion, the first half of 2024 has shown encouraging signs of recovery and growth for private equity in both the general M+A market and the healthcare sector. Improved deal activity, strong fundraising, and strategic investments indicate a resilient and adaptable industry poised for continued success. The healthcare sector, in particular, remains a key area of interest for investment groups, with ongoing investment opportunities driven by market demand and strategic divestments.
Current Private Equity Activity Is Good News for Healthcare Business Owners
Understanding private equity activity is crucial for healthcare business owners considering selling their companies. The current market conditions in the first half of 2024 have shown recovery and growth in private equity, particularly in the healthcare sector. Improved deal activity, strong fundraising, and strategic investments indicate a resilient and adaptable industry poised for continued success.
As deal activity increases for private equity firms, this signals that buyers will be actively seeking investments in the healthcare market. Private equity firms aim to increase the value of their investments through market consolidation and eventually exit from these investments in the coming years. This positive trend in deal activity among private equity firms suggests favorable conditions ahead for the sale of healthcare businesses, regardless of their size. For business owners, staying informed about private equity trends and market dynamics can provide valuable insights and better prepare them for potential sales, ensuring they achieve the best possible outcomes in a competitive market.
At VERTESS, we specialize in healthcare M+A transactions by working with business owners to capitalize on these market opportunities and negotiate the best deal possible for their business. We have built a network of relationships with buyers in our key verticals to ensure we bring the right pool of buyers to any client. This will help not only achieve the best outcome in purchase price but also the best post-transaction fit for their business, employees, and clients. If you would like to learn more about the state of healthcare M+A and investing or how VERTESS is particularly well-suited to help sell your healthcare business, please reach out to us.
Dave Turgeon, CM&AA
I’ve been fortunate to work for several exceptional companies. I’ve contributed in roles that include CEO, COO, and managing growth. I’ve been part of private equity-backed companies focused on building value and growing, which has allowed me to acquire of hundreds of companies and invest billions of dollars. I began focusing on behavioral health about twelve years ago based on a family member. Many people know me from my experience running the M&A efforts at Civitas Solutions leading up to their successful IPO in 2014. I feel very fortunate to be in a position now to help business owners who built companies whose mission it was to care for others. I’m in the unique position of helping them get the very best deal possible
As a Director at VERTESS, I bring extensive experience in sales, consulting, and project management from early-stage startups. With an MBA from Babson College, I have a strong foundation in business strategy, operations, and financial analysis. My personal connection to behavioral healthcare through a family member motivates me to help business owners get the best deal possible while ensuring high-quality care for their clients. Throughout the M&A process, I provide comprehensive support at every step. I have a proven track record in negotiations and client management after working with companies in various industries. I’m excited to join VERTESS and make a meaningful impact on the lives of the owners I work with.
We can help you with more information on this and related topics. Contact us today!
Volume 10, Issue 25, December 5, 2023
We recently co-hosted a webinar with Behavioral Health Business during which we discussed exit planning and opportunities for owners and executives in the behavioral health space who may be thinking of or starting to plan an exit strategy from their business (i.e., sell their business). The webinar aimed to provide strategic insights into the behavioral health industry's acquisition landscape, covering diverse topics such as private equity models, positive aspects of behavioral health businesses, and building successful partnerships. The program featured Aly Champsi, managing director at DW Healthcare Partners, and Jenna Whigham, president of Abound Health. Jack Turgeon, senior consultant with VERTESS, served as moderator for the webinar.
The webinar recording can be accessed here.
Key topics covered during the program included the following:
Buyer profiles and deal structures. We discussed the opportunities that exist for sellers from private equity, strategic buyers, and search funds along with the different deal structures and support models for each buyer type.
Successful buyer partnerships. We explained the importance of building successful partnerships between investors and business owners which allow existing management to continue running and growing the business while leveraging support from the investor.
Attractive acquisition targets and red flags. We answered common questions, such as the following: What are buyers looking for in an attractive business they are willing to consider purchasing? Why are buyers increasingly investing in behavioral health companies? What are some areas of concern or red flags they look for in businesses they are targeting? How can a seller get the maximum value on the sale of their business?
Trends in the industry. Among the trends we discussed were the growing demand for services related to autism and developmental disabilities, and opportunities in eating disorder and addiction treatment clinics.
Industry challenges. Challenges covered include those with insurance companies, preauthorization, and efficient billing and revenue collection.
Champsi kicked off the program, emphasizing the importance of understanding the private equity model and the role of existing management in business growth. He highlighted the need for DW Healthcare Partners to acquaint itself with acquired companies and enable the current management to sustain and develop the business. Champsi also addressed concerns from healthcare business owners, discussing perceptions of private equity in the industry.
In the second segment, Whigham shared insights into her company's history, mission, and strategic growth through acquisitions. She discussed Abound's focus on acquiring provider agencies, leveraging software for operational efficiency, and navigating billing challenges. Whigham elaborated on Abound's expectations for acquired businesses, criteria for potential targets, and flexibility in deal structuring.
Throughout the webinar, the panelists underscored the importance to their organizations of identifying high-quality businesses in the behavioral health sector for possible investment and acquisition. Emphasis was placed on the necessity for businesses to commit to compliance and deliver high-quality services. The speakers advocated for thorough due diligence, including background checks on partners, regulatory compliance assessment, and careful evaluation of stability in group home settings.
Regarding business valuation, potential red flags like compliance issues and client churn were highlighted as critical considerations in the acquisition evaluation process, as was the common challenge of maintaining a full complement of staff while managing overhead.
In summary, the webinar delivered valuable insights into the behavioral health industry's acquisition landscape, covering private equity, positive aspects of the business, industry trends, challenges with insurance, and specific areas of interest like eating disorder and addiction treatment clinics. The practical advice offered is particularly beneficial for business owners contemplating the eventual exit of their businesses.
How to Value Your Behavioral Health Business?
A question attendees may be asking themselves after watching the webinar is: "What is my behavioral health business worth?" It's a complicated question, with a unique answer for every business VERTESS works with.
As a healthcare-focused M+A firm, we at VERTESS help owners understand the expected value of their business if they are to bring their company to market. A great way to gain a better understanding of your business's value is to reach out to us directly using our contact information below. We look forward to hearing from you. rs to increase spending on new systems, new technology and upgrades to existing IT systems.
What This Means for Healthcare IT Firms
A rapidly growing market, obviously, means opportunity for growth. However, history shows that such markets often outpace the ability of companies to grow their business organically. Because of this there will be a flurry of mergers and acquisitions in the IT healthcare segment in 2017 and beyond.
Indeed, some of that activity has already manifested itself as forward-looking healthcare IT firms position for the oncoming changes. Notable Healthcare IT transactions in 2016 include:
IBM Watson Health’s acquisition of Truven Health Analytics, GI Partners’ acquisition of Netsmart Technologies, Veritas Capital Partners’ announced acquisition of Verisk Health, and ResMed’s announced acquisition of Brightree—transactions that, in total, comprise over $1 billion each. Many of these firms will be on full display in Orlando, Florida, during the upcoming HIMSS conference - www.himssconference.org
What this means to you is that there’s never been a better time to sell your healthcare IT firm because the feeding frenzy is already starting. However, if you want to get the best price for your firm, you’ll still need expert advice to maximize your offers.
Similarly, and a bit ironically, there’s never been a better time to expand by acquisition. Yes, it’s a seller’s market, but there is so much potential growth in the IT segment that it will be almost impossible to grow organically and keep up with the market.
Thus, if you want to maintain market share, you’ll need to think M&A. In that case, it’s EVEN MORE crucial to get expert advice during negotiations because otherwise you’ll end up spending more than necessary to acquire a new asset. You need somebody in your corner who “knows all the tricks” as they say.
Whichever strategy you’re pursuing, I can promise you this: hang onto your hats people, because it’s going to be one hell of an exciting ride.
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