While startups have built businesses around project-management tools, video-collaboration tools, whiteboard tools and others, there is a limit to how much they can grow with a single product offering. In particular, software companies that make tools that can be included as features in larger platforms will be attractive acquisition targets, several analysts said. The Wall Street deal expert spoke on condition of anonymity because of the sensitivity of the business dealings. Buying over buildingĪ person familiar with Wall Street tech deals who requested anonymity told Insider that even struggling companies may look to M&A since it may be more cost-effective to buy a well-run startup rather than waste time and money to experiment internally to build out the product themselves.

In this environment, analysts and experts expect consolidation, and for larger players to use this as an opportunity to acquire new tools at a good price. That often involves making the leap from a single product to a full platform of tools. Figma didn't face that issue with Adobe's bid because the purchase price was double Figma's last private valuation of $10 billion.Īs companies look to cut spending amid the downturn, many of these startups are facing critical moments where they must prove their worth and necessity to customers. However, as public-market valuations have fallen, many of these startups are pausing plans to go public with the fear that their valuations will drop.

Over the last few years, productivity-and-collaboration tools like Figma, Miro, Airtable, and Notion scored unprecedented funding and high valuations thanks to the shift to remote work and a corporate interest in new software tools. These are 15 private and public software companies that analysts think could be acquisition targets.Īdobe's $20 billion bid to acquire Figma is the largest ever acquisition of a private software company, according to Bloomberg data, and reopened conversations about what's ahead for software startups, during a period where IPOs and blockbuster deals have largely paused.Software companies that could be features of larger platforms are targets for the incumbents.Adobe's $20 billion bid for Figma reopens conversations about what's ahead for software startups.

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