The acquisition last week of Mark Boulton Design by a leading US technology player is further proof – if any is needed – of how much talent there is in the creative industries in Wales.
Boston-based Monotype, which employs 354 people and is listed on NASDAQ, has bought the seven-strong Cardiff based web developer mainly to acquire the rights to its bespoke design tool, Gridset.
For Mark Boulton, joining Monotype is an opportunity to be in the thick of exciting changes in the way brands publish content and engage with consumers online.
And good luck to him: he has built a business from scratch since leaving the BBC in 2006, and it does look like there is synergy between Gridset and other software products owned by Monotype.
As with any acquisition, it won’t be possible to judge fully the success of this deal – for buyer or seller – for several years.
My own experience as a buyer of creative agencies is mixed. From 2004 to 2010, Freshwater acquired 12 businesses across the UK, ranging from one man bands to a well-known London consumer consultancy with 22 staff.
In assessing their success, the main problem is that most of them were made just before Lehman collapsed and the economy fell off a cliff in 2008.
It was hardly the ideal time to be going through the process of integrating so many disparate people businesses. Who knows what would have happened had the conditions been more benign?
But, if pressed, I would say four were successful, one was an abject failure and the rest were only partial or temporary successes.
The ultimate test of an acquisition strategy is, of course, the delivery of shareholder value; and, on that unforgiving score, we have some way to go before Freshwater’s earnings per share recovers to its pre-Lehman level.
But we are nevertheless a successful business by other measures, growing organically on a platform that could not have been created so quickly without acquisitions.
Indeed, speed is often the main impetus for acquiring. Monotype may well have been able to develop software similar to Gridset but this acquisition means they have it immediately - an important factor in such a fast-changing world.
So what are the ingredients of success? Here are a few dos and don’ts from me:
The Mark Boulton - Monotype deal is part of an upward trend in acquisition activity as businesses re-group for growth. Hopefully, it will be among those that stand the test of time.