Acquisitions have a way of turning sensible leaders into kids in a candy aisle, eyes bigger than the M&A budget. The promise sounds irresistible: more revenue, more markets, more everything. Yet size can be a sneaky illusion, like a buffet where the plates are small and the regrets are large.
If you are starting, acquiring, and building businesses with capital, time, talent, and technology inside a holding company, the temptation to swing for a headline deal is real. Resist it. The smarter player is often smaller, quieter, steadier.
People really love big numbers. A giant top line feels like instant, sturdy credibility. The spreadsheet glows, synergy slides sparkle, and everyone imagines a smooth march to dominance. Big targets usually bring complex systems, layered teams, and habits stacked like nesting dolls. The time tax is very real, and time is the first expense buyers underestimate.
Bigger deals also change the psychology of execution. Leaders grow cautious because the cost of a mistake rises. You get fewer experiments, slower decisions, and meetings that require a seating chart.
Yes, size can buy reach, bargaining power, and talent density. Those are good things. They can also arrive with side effects that behave like glitter, spreading into every corner of the business and proving very hard to clean up.
Large acquisitions create tangles of systems, vendors, and workflows. Finance wants a unified close. Sales wants a common pipeline. Engineering wants platforms that talk without turning on each other like rival cats. None of that is impossible, but it is rarely quick. While teams wrestle with data fields and permissions, customers wait, and competitors quietly hunt for your distracted accounts.
Attention is oxygen. A large deal consumes it. Senior leaders spend long stretches running issue triage instead of sharpening the product, the brand, or the funnel. That trade can be worth it, but only if the acquisition closes a major gap you could not bridge on your own. Otherwise, you are swapping creative momentum for project management and calling it strategy.
Culture does not merge on command. People carry habits that made them successful, and they defend those habits with smiling stubbornness. Pace is the first casualty. The now larger company moves like weekend traffic. That slow drift has a cost that never shows up in the model, and it is paid in missed windows and dulled urgency.
Smaller targets often have simpler books, narrower scopes, and fewer unknowns. That makes the math cleaner and the bets more flexible. You can model key drivers with fewer assumptions and change course without dragging a caravan behind you.
Shorter payback periods are the friend of the restless operator. When you buy a compact business that throws off steady cash, you can fund improvements from its own flow instead of tapping the mothership. The risk curve bends in your favor because you need fewer things to go right.
A set of smaller acquisitions acts like a basket of options. Some will be solid singles. A few will surprise you. The losers will be survivable. That mix is powerful because it compounds learning. Every integration teaches you something about onboarding, pricing, metrics, and people.
The best acquisitions solve a specific problem with minimal side effects. They are not bought for bragging rights. They are bought because they make the core business faster, cheaper, or more lovable to customers.
Ask whether the target brings you closer to the customer you already serve. Does it shorten the path to value, reduce friction, or deepen trust? If the answer is yes, you can usually measure the lift quickly and unemotionally. If the answer is no, you may be funding a distraction with a press release.
Check for alignment in data, tooling, and process. Shared definitions of a lead, a ticket, or a return save months. When systems click together cleanly, your teams can focus on improving the customer experience instead of translating acronyms.
Business loves the language of risk, but in acquisitions the real story is resilience. Smaller, well chosen deals bend instead of breaking. If the economy hiccups, you can throttle investment. If the product misses, you can regroup. You do not need to stage a rescue mission that soaks up attention and burns political capital.
Resilience also shows up in morale. Teams can see the edges of the work. Wins arrive quickly and visibly. People feel effective. That feeling compounds just like revenue. It keeps talent engaged and creates the sort of operating rhythm that outsiders like to call luck.
If you decide to go small, do not drift into it. Be specific about what you are buying and how it will pay back.
Write down the one job the acquisition must do for the business, and keep it brutally narrow. Maybe it gives you a new segment, a reliable supply, or a missing feature. If the draft sounds like a festival of maybes, you are not ready to buy. A clear job is your map when integration turns into a maze.
Valuation models love aggressive synergies. They glow in meetings. Price instead for the value you can deliver with the team and tools you have. Treat upside as gravy, not rent you owe to the future. If the deal only works with perfect cross sell or dreamy cost savings, it is a story, not a strategy.
Title inflation is a hidden cost. A small acquisition that arrives with three layers of management will try to keep them. Say no. Preserve a light structure that reflects the actual work. Reward outcomes, not boxes on a slide. When you keep the shape lean, decisions move faster and politics has less room to grow.
The secret to compounding through acquisitions is not daring. It is repeatable. Build a playbook that scales your judgment. Standardize diligence checklists. Decide how you measure payback, and stick to it. Set crisp integration steps that teams can execute without heroics. After each deal, do a short retro that asks what to keep, what to fix, and what to drop.
Over time, the company becomes the kind of buyer that sellers want. Clean deals close faster when your reputation is tidy and your promises are realistic. That attraction loop means better opportunities find you.
There is a special satisfaction in a deal that slips into place and starts working while everyone else is still editing their integration plan. Revenue hums. Churn softens. Support tickets look normal. The customer notices improvements without having to learn a new language. You get to build, not babysit, which is why you got into this game in the first place.
Bigger can feel bold, but in acquisitions bold is not the same as wise. The art is choosing a deal that strengthens the business you already run, without drowning it in complexity. Right sized targets protect cash, preserve momentum, and give teams the satisfaction of work that lands. If you keep the job clear, price what you control, and move with calm discipline, you will stack quiet wins that last longer than any headline. That is how better beats bigger.
Ryan Schwab serves as Chief Revenue Officer at HOLD.co, where he leads all revenue generation, business development, and growth strategy efforts. With a proven track record in scaling technology, media, and services businesses, Ryan focuses on driving top-line performance across HOLD.co’s portfolio through disciplined sales systems, strategic partnerships, and AI-driven marketing automation. Prior to joining HOLD.co, Ryan held senior leadership roles in high-growth companies, where he built and led revenue teams, developed go-to-market strategies, and spearheaded digital transformation initiatives. His approach blends data-driven decision-making with deep market insight to fuel sustainable, scalable growth.
