Eric Siu explains why buying fast-growing companies is expensive and competitive. His strategy: acquire many smaller, scaling companies too small for private equity to notice. Multiple small acquisitions can move the needle more than chasing one big deal.
thing that I've learned about buying is companies you really want to buy are these big, fast-growing, sexy companies, but they're too expensive and they're really competitive. And then you got the big companies, but they have some hair on it. Those companies, if you can get them for the right price, it's worth it. But they're still somewhat competitive by private equity is what we're seeing. The deals that we've focused on are small deals that don't really have too much competition because they're too small for private equity. And buying one of them doesn't really move the needle. But buying 10, 20 of them really moves the needle, but that's the only way we can make the math work to go against our competition is we go after really good companies that are small, but they're scaling up and they're still growing nicely, but they're too small for a company doing $18 billion a year in revenue to buy.
