Business Strategy

How to use apps to make your business an irresistible acquisition target

September 23, 2014

  • Alex Bratton

The PayFlex example

In 2009 PayFlex, a third party administrator of employee benefit programs, approached Lextech to develop apps for the iPhone, Android, and BlackBerry. The apps made it possible for users to submit receipts for healthcare services while at the pharmacy or doctor’s office, rather than waiting until they got home to do so via the website.

The apps met a real need, but the value the client realized went beyond what it did for their end users. The company’s former CIO, Tony Dillon, noted that being able to offer their clients these apps took the organization’s sales close rate from 37 percent to a startling 96 percent and eventually led to the organization’s acquisition by one of the largest benefits providers in the world, Aetna.

“I believe we were acquired because we were perceived as a technology company that happened to work in healthcare, rather than a healthcare company that had technology tools,” said Dillon.

PayFlex was positioned as a thought leader in their industry because of their solid mobile tools.

3 ways apps position your company for acquisition

Impactful apps can help organizations stand above the noise of useless apps in the marketplace, and they can be immensely powerful tools for positioning your organization for acquisition. Here’s how to use apps to make your business an acquisition target:

1. Apps (done well) make your organization innovative.

We won’t pretend releasing cr-apps is going to open a buyer’s wallet, but producing quality apps that make a real financial impact on your business or those of your customers highlight a strength that is important — you have an eye on the future and understand how people want to use technology. 

Your business isn’t going to get stale in six months when the next big thing hits your industry because you’re already planning for it. If your business doesn’t have any apps or you’ve only made half-hearted attempts, you’ll be seen as a laggard. Checks aren’t usually written to acquire laggards, unless it’s a turnaround firm in which case the want the laggard so they can fix it by adding elements like technology.

2. Apps attract top talent.


Last year a panel of executives from Google, Twitter, and Yahoo! all revealed they are seeking acquisition targets for their talent, rather than for their products or services, a practice called acqui-hiring. If you want to attract and retain the best talent, apps are your golden ticket.

By 2025, millennials will make up a whopping 75% of the global workforce. Millennials have no patience for archaic technology. They expect consumer-quality user experiences with enterprise-grade power. Anything less will send them running to a competitor, right along with your acquisition prospects.

3. Apps demonstrate a commitment to profitability.


BlueStar Energy Solutions reduced their 12 hour paper-based auditing process to just four hours by streamlining their process with an iPad app. Shortly after the launch of their app, they were acquired by AEP Energy. If you read between the lines, it isn’t hard to draw the conclusion that this app played a key role in that decision.

When a business invests in refining its processes to become more efficient, it sends a clear message to would-be acquirers that they manage the bottom line in a very strategic way. They see that using technology to improve processes can be a big competitive differentiator.

Whether you hope to be acquired or just want to increase your business’ market appeal, apps can do the heavy lifting that gets you there.

Contact Lextech today to get started.