When Evaluating an M&A Opportunity, Consider the Broader Digital Ecosystem
Executives increasingly recognize that acquisition targets should be assessed through the broader ecosystem surrounding them. This includes developers, partners, and complementary technologies, but existing M&A frameworks provide limited guidance for evaluating those relationships systematically.
2026-09-09
Assess acquisition targets beyond market power and capabilities.
Examine developers, partners, and complementary technologies connected to potential targets.
Consider whether combining ecosystems could create value through stronger connections.
Revisit deal logic as ecosystems evolve after an acquisition.
M&A Evaluation Extends Beyond Traditional Deal Metrics
Traditional Criteria Shaped Earlier Acquisition Decisions
Potential deals have traditionally been evaluated through factors such as market power and access to new capabilities. Facebook’s 2012 acquisition of Instagram for $1 billion was widely viewed as a defensive move against a fast-rising competitor and as a way to strengthen Facebook’s position in mobile photo sharing.
Combining Ecosystems Can Reveal Additional Value
Nearly 15 years later, the logic of the Instagram deal is viewed differently. Research suggests that combining two ecosystems may create new value through stronger connections with developers, partners, and other complementors , a potential source of value that earlier analysis may have overlooked.