Stifel, a diversified global wealth management and investment banking company, recently held a private company forum in Bluffton, South Carolina. Transportation and Logistics (T&L) companies were a predominant part of the attendance, in addition to private equity (PE)/Investment Banking firms. As you can probably guess, a huge topic at this forum was M&A.
At this event, our CEO, Peter Rentschler and our VP of Corporate Development & Strategy, JT Engstrom had the opportunity to sit down with Evan Mcabee, Director at Stifel Investment Banking, to discuss technology-focused trends and lessons learned within the Transportation and Logistics industry. In case you missed it, or just want a refresher, we're sharing some of the key takeaways now.
With this, there are numerous trends and lessons that we encourage T&L companies to understand and act on, including:
Venture Tech Enabling Down Market Businesses
Continued levels of elevated Venture investing in freight technology is resulting in the building of tech that enables SMB to compete with bigger players. This works in parallel with the fact that customer and vendor expectations have never been higher.
Not all Tech is Value-Add
Given the growth of readily available technology modules, it is critical, now more than ever, to focus on building technology that differentiates you and buying what you can as an accelerator. Tech that enables new services lines (ex. SMB Managed Transportation) can drive incredible value.
Implementation is Just as Important as the Build
Many companies focus on building incredible technology. Great! However, many of those same companies do not spend the time and energy needed for quality adoption of that tech. When widening their tech stack or capabilities, businesses need to consider and plan for transition activities, training/on-going training, and maintenance.
Get Smart on Data, Really
Everyone is talking about AI/ML (artificial intelligence/machine learning), without having a proper data management strategy in place. It is important to understand that building AI trained on bad data is worse than having the whole process be manual. We repeat: AI trained on bad data is worse than having the whole process be manual.
Now, we’re here to say: unfortunately technology within the transportation and logistics sector can have major gaps, which materially affects enterprise value (EV). This brings us to…
As proof, we are also sharing examples we’ve seen after performing dozens of IT Diligence and Tech Strategy projects related to M&A over the past 24 months.
The Metafora team is positioned within the transportation & logistics industry to guide businesses throughout various stages of the M&A lifecycle: Defining an M&A Strategy, Building a Target Pipeline, Conducting Due Diligence, Transactional Support, and Executing Integration Activities. Using 2021 as a launchpad, Metafora is dedicated to serving, growing, and disrupting the transportation and logistics space into 2022 and beyond.
Learn more about our newly announced M&A Service Offerings here.
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