5 Key Drivers Shaping the M&A Market in 2026

As confidence continues to build across the small- and midsize-business landscape, activity in the mergers and acquisitions (M&A) market is gaining new momentum in 2026. To help Vistage CEOs better understand what’s driving this shift — and what it means for your business — I sat down with Zane Tarence, Managing Director at Founders Advisors, for a deep dive into the key forces shaping today’s M&A environment.

Whether you’re planning to sell, acquire, or simply stay informed, here are five key drivers from our conversation to help you think more strategically about your future.

1. Interest Rates Are Fueling M&A Deal Activity

After a series of interest rate cuts in late 2025, borrowing costs are lower, making capital more accessible for buyers. Cheaper money leads to higher valuations because buyers can use more leverage and less equity.

What This Means for CEOs:

Lower interest rates are reviving deal flow. Whether you’re planning to sell or acquire, now is a more favorable time to explore your options.

2. Valuation Expectations Are Aligning in the M&A Market

In recent years, a wide gap between seller expectations and buyer willingness has slowed down deals. Now, that gap is narrowing. Buyers are more confident and ready to deploy capital — but with discipline. Sellers are becoming more realistic in pricing.

What This Means for CEOs:

Valuations are stabilizing, and buyers are re-engaging. Now is the time to ensure your business fundamentals — recurring revenue, clean financials, and strong leadership — are in order.

3. Strategic Buyers Are Actively Seeking Synergies

Public companies and larger strategic acquirers are aggressively pursuing acquisitions to accelerate growth. With organic growth harder to achieve, many are shifting focus to acquiring innovation, technology, or regional footholds.

Interestingly, strategic buyers are often less concerned with company size — if there’s a strong strategic fit, even small businesses are attractive.

What This Means for CEOs:

If your company brings strategic value (IP, M&A market share, talent, or tech), it could be a target — regardless of revenue size.

Explore more from Founder Advisors: 12 Factors to Drive an Outsized Valuation. Available now on the Vistage Transaction Center (login required). 

4. Private Equity Firms Are Back and Focused on Add-Ons and Roll-Ups

After sitting cautiously on the sidelines, private equity firms are re-entering the M&A market. Many are focused on buying “add-ons” for their existing platform companies, especially in fragmented industries. The result: There’s a surge in roll-up strategies targeting companies with $10–100M in revenue.

What This Means for CEOs:

Know your positioning: Are you a potential add-on or a future platform? Either way, growth, scale, and predictability will boost your valuation and attract interest.

5. International Buyers Are Increasing Their U.S. Activity

Cross-border M&A is rising. International buyers — including sovereign wealth funds — are seeking U.S.-based companies to strengthen supply chains, access innovation, and invest in stable, rule-of-law markets.

What This Means for CEOs:

Don’t overlook inbound interest. Foreign buyers may bring competitive offers, particularly if your business aligns with global supply chain, technology, or infrastructure strategies.

People Equal Results

With talent being a top decision, investment and challenge for CEOs in the year ahead, Zane emphasized the significance of talent in M & A, stating “Exceptional people create exceptional results.” Acquirers are buying talent just as much as product or market share. They’re also acquiring innovation; there is a trend of large companies reducing their Research & Development and instead buying proven solutions, technology and talent.

In previous years, seller expectations and buyer willingness were miles apart. That gap is shrinking. With valuations stabilizing and more flexible deal structures on the rise, 2026 may be the strongest year in a while for deal-making.

Now is the time for CEOs to prepare simply by building a healthy company. Build optionality by knowing your valuation, cleaning up your balance sheet, benchmarking your industry, and clarifying your desired outcome. Zane offered this practical guidance for CEO decision-making:

• Know if you’re an add-on or a platform. Choose intentionally.
• Focus on fundamentals: recurring revenue, competitive differentiation, and talent.
• Benchmark your business using industry associations, bankers, and Vistage tools like BizEquity.
• Embrace AI and tech — not as buzzwords, but to improve margins, customer experience, and operational predictability.
• Stay aware: You don’t have to sell, but ignoring the M&A market is a risk.

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