‘The plan is to do more IT acquisitions in 2025’: Focus Group CRO on M&A fever

Rhys Bailey discusses recent investments, 2025 plans and cultural alignment

“A core part of our strategy is to continue to do M&A, so the rate at which we're buying will continue at a fast pace for FY25 and onwards,” Focus Group’s CRO, Rhys Bailey, tells CRN about the company’s recent acquisition drive.

The chief revenue officer and interim CEO, shares insights on the reseller’s many buyouts this year, and gives us a glimpse into 2025.

In 2024 alone, Focus Group snapped up 12 businesses, the latest of which were Prism and Contact Systems.

“Prism caught our attention because it is an MSP with a very high recurring revenue that predominantly looks after UK SMEs,” says Bailey.

“This is very similar to our core focus base.

“Around 20 per cent of our revenue comes from IT services already, so we wanted to expand our IT offering and buy more scale in that area.

“The plan is to do more IT acquisitions as we move in FY25.”

The company’s expansion saga has been backed by significant private equity investment.

Focus Group’s current investor i s Hg, who took a 60 per cent stake in April, following the exit of previous investor Bowmark Capital.

“Back then, we couldn't do any acquisitions for a while because we were working on our own deal,” Bailey explains, referring to the Hg signing.

“We had a pipeline sitting there, waiting to go.

“We also sped up our M&A strategy in March 2020, when Bowmark Capital took a 25 per cent investment stake in us, which gave us a war check to go and buy more businesses.”

The CRO adds that even though the company was boosted by these investments, buyouts have been a core element of Focus Group’s strategy since 2016.

But with so many acquisitions in such a short period, the reseller now faces another challenge; integration.

“We've got an integration playbook that we've refined and worked on for many, many years,” says Bailey.

“But that being said, every acquisition is slightly different, so our integration team will go and understand the quirks of the business that we've just invested in.

“We spend a lot of time looking at cultural alignment, ensuring that people in the organisation are open to change.

“We already have a clear process on how to bring their billing in, how to bring them over to our services support desks, and how to move their salespeople onto our way of selling; it's all documented.

“We tend to integrate everything within the first six to 12 months after the merger.”

2025 and beyond

Looking ahead, Bailey says the company has already made up its mind on its buyout strategy for next year.

“We’ll probably make around six deals in 2025,” he tells CRN.

“Three to four of those will be hosted comms focused, connectivity focused, and then two or three will be more IT focused.”

But far from getting carried away by an expansion frenzy, Bailey explains that the company will keep its feet on British ground for the foreseeable future.

“We've got less than one per cent of the UK market, so there's no need for me to go and look across Europe or the US at this point.”