In a year marred with uncertainty amidst a global pandemic, 1H’20 M&A activity suffered heavy declines as hundreds of deals in the market came to a screeching halt. Bankers and buyers were forced to re-evaluate process timelines and strategy while CEOs adapted new sales and marketing tactics and recast budgets and projections. Yet in a stunning V-shaped recovery, M&A spending in the technology sector soared to new record heights in the second half of 2020, reaching an all-time high of over $400 billion in 2020 transaction value. This surge in M&A is attributable to several factors including a high availability of financing, pent-up demand after a slow second quarter, and dealmakers embracing a virtual close amidst travel restrictions. 
Transactions in payment software (Upserve’s sale to Lightspeed at 10.8x revenue) and workforce/collaboration software (SocialChorus’s sale to Sumeru Equity at 5.0x revenue) illustrates the market’s use of M&A as a vehicle to adapt to the unique landscape created by COVID-19. Non-tech companies like Sandvik and Moody’s used software acquisitions in 2020 to streamline operational workstreams and prioritize governance/compliance efforts. Intrepid’s Software and Services team has witnessed robust interest from the market for innovative software solutions seeking M&A as a catalyst for augmented growth. Non-tech companies like Sandvik and Moody’s used software acquisitions in 2020 to streamline operational workstreams and prioritize governance/compliance efforts. Intrepid’s Software & Services team witnessed robust interest from the market for innovative software solutions seeking M&A as a catalyst for augmented growth.
Christopher Park
Managing Director, Head of Software & Services
cpark@intrepidib.com