PEs are core drivers in digitization

With the expe­ri­ence of >700 reali­zed digi­tal projects in the last 10 years, we can say that digi­ta­liza­tion is one of the core value drivers for the equity story of compa­nies. Ther­e­fore, it is very attrac­tive for private equity compa­nies to further deve­lop and streng­then the digi­tal “assets” of their port­fo­lio compa­nies in the sense of a posi­tive equity story. We see a strong sense of opti­mism among the rele­vant investors.

Through broad and cross-indus­try expe­ri­ence, PEs have unders­tood faster than many other compa­nies what oppor­tu­ni­ties lie in digi­tiza­tion — and what risks one runs if one does not invest consis­t­ently and quickly in digi­tal value enhance­ment programs. We always work out the digi­tal aspect very clearly in our M&A tran­sac­tions and it is a core compo­nent of commer­cial due dili­gence. Some private equity fund compa­nies also set up their own digi­tal teams for this purpose, which then imple­ment the value enhance­ment programs in the port­fo­lio with us. In this dyna­mic envi­ron­ment, inves­tors are digi­tiz­ing their own DNA and passing it on to their port­fo­lio compa­nies. In this way, inves­tors become trail­bla­zers who give decisive impe­tus to the more tradi­tio­nally shaped SME sector in parti­cu­lar. Due to the willing­ness of inves­tors to invest in digi­tiza­tion, the limi­ting factors are not money, but rather time and the ability to bring the right digi­tal talent into the organization.

If we are not active in the context of an M&A tran­sac­tion, we start with a digi­tal matu­rity analy­sis focu­sing on the company, the market and the compe­ti­tors. Based on this, we deve­lop a digi­tal value crea­tion program inclu­ding a busi­ness case and mile­sto­nes and go straight into imple­men­ta­tion. Digi­tal compe­ti­tion does not forgive any loss of time.

The imple­men­ta­tion focu­ses on diffe­rent areas of the company and is based on 30 proven digi­tiza­tion concepts (such as digi­tiza­tion of value crea­tion, products, sales chan­nels, data use and analy­sis, proces­ses, as well as on buil­ding a “digi­tal” orga­niza­tion). Through our proprie­tary data­base of >100 million data points from tran­sac­tions and imple­men­ta­tion consul­ting, we can make data-driven decis­i­ons and accu­ra­tely deter­mine a company’s matu­rity and deve­lo­p­ment poten­tial. We do not think in the short term, but in terms of invest­ment cycles and holding periods.

Since we not only provide our clients with stra­te­gic advice but also accom­pany the imple­men­ta­tion of the programs from “one source” with our in-house staff, we can react quickly to new trends and adapt the stra­te­gies. Our approach is not to build cast­les in the air, but to deve­lop serious, sustainable and imple­men­ta­ble solu­ti­ons that alre­ady achieve initial success in three to six months — this crea­tes trust and joint success, which is important for the imple­men­ta­tion of the more complex tasks. Some clients are now in their 3rd gene­ra­tion of owner­ship, and all OMMAX teams, whether in Tran­sac­tion Advi­sory, Digi­tal Stra­tegy or Digi­tal Execu­tion, have played a signi­fi­cant role in their respec­tive success stories.

The e‑commerce sector and B2B service busi­ness models in parti­cu­lar are very dyna­mic at the moment; we see annual growth rates of 40–60 percent here. Indus­try repre­sen­ta­ti­ves are among those who have bene­fi­ted from the Corona crisis. Of course, this also brings strong move­ments into the tran­sac­tion market, as many private equity firms now want to sell their assets at a profit. E‑commerce is no longer limi­ted to the B2C market; B2B e‑commerce is also beco­ming incre­asingly important. Many compa­nies can no longer adver­tise their products at trade fairs, so self-service portals, digi­tal sales plat­forms and a “digi­tal” custo­mer approach inclu­ding simple appoint­ment booking routes and uncom­pli­ca­ted digi­tal commu­ni­ca­tion are the “be-all and end-all”.

About Dr. Stefan Sambol

Stefan is a part­ner at OMMAX and advi­ses in parti­cu­lar medium-sized compa­nies as well as inter­na­tio­nal finan­cial investors.
As a specia­list in digi­tal busi­ness consul­ting, stra­tegy and imple­men­ta­tion, he advi­ses compa­nies stra­te­gi­cally and opera­tio­nally on digi­tal value crea­tion programs with a focus on orga­nic growth stra­te­gies. In addi­tion, Stefan supports finan­cial inves­tors in the acqui­si­tion and assess­ment of digi­tal busi­ness models as well as the evalua­tion of value crea­tion potential.