Strategic moves: M&A, IPOs and exit strategies in the tech industry

From the 2025 Technology Finance Symposium - West

John Melbourne, Vice President, Baker Tilly Capital, provided a fast-paced overview of key market trends driving deal activity and valuation shifts across the tech and software landscape. In a market still navigating volatility, the session outlined where opportunities remain strong – and what investors and operators should expect in the months ahead.

The presentation opened with a recap of global M&A trends, noting that while deal value peaked in 2021, activity has rebounded since a slowdown in 2022 and early 2023. In fact, “coming out of 2024 [we] saw a nice uptick and robust activity from the M&A side of things, coming in at $3.7 trillion in total deal value across 45,000 transactions,” the speaker reported.

The software and SaaS sectors remain particularly active. Q1 2025 marked one of the strongest quarters for software M&A since early 2022, with SaaS deals making up 58% of software transactions. Melbourne emphasized that top-quartile, high-growth and differentiated software companies continue to command premium valuations. Vertical SaaS providers – particularly in healthcare, financial services and retail – remain especially attractive, driven by defensible market positions, embedded workflows and high switching costs.

Private equity deal-making has also shown resilience. After a dip in 2022, private equity activity rose 23% year over year in 2024, with add-on acquisitions accounting for 75% of all buyout activity. These smaller, strategic acquisitions allow firms to consolidate markets and deploy capital efficiently in a landscape still contending with tight credit conditions and valuation mismatches between public and private markets.

The conversation also covered exits, noting a sharp drop-off after 2021’s highs but some recovery in 2024, driven by continued pressure from limited partners (LPs) for liquidity. While IPO markets remain muted, private-to-private and continuation fund sales have filled some of the gap.

On the fundraising side, while overall capital raised has slowed, private equity firms are holding substantial capital reserves, with over $1 trillion available for deployment. Venture capital fundraising has similarly concentrated in larger billion-dollar funds, though smaller sub-$50 million funds continue to find success.