Internet Industry Mergers and Acquisitions

Abstract

If the prediction that two-thirds of today's Internet companies will fail within five years proves accurate, now is the time to develop an M&A strategy in the event that you're not among the fortuitous one-third. Valuation volatility in the dot.com sector reflects the lack of a consistent valuation methodology—one that depends on a highly subjective combination of both hard and soft metrics, the latter comprised primarily of human capital—ideas, experience, talent. Internet M&A trends point to reasonable valuation, as well as speed in the determination of whether to sell, as important factors in extracting maximum value in a rapidly consolidating sector.