Software and IT Services Outlook

Insights by Robert Fiske.

If you own a software or IT services (SITS) business or are interested in that sector, we have a couple of things just for you!

Firstly, newly published is the latest issue of our twice-yearly report looking at the state of M&A in the UK software and IT services sector. It includes our analysis of the market last year, results from our recent survey of owner-managers and another guest article from a former Prism client.

These reports are inevitably “behind the curve” as we have to delay publication to allow time for transactions to be recorded. This latest report shows that 2024 transaction volumes were slightly higher (7.5%) than in 2023. This is good news off the back of the c.20% decline in transactions seen in 2023 compared to 2022. However, the post-Covid boom in deal making does seem to be ebbing slightly, as current numbers for the first quarter of 2025 have dropped back down to previous peak levels seen in 2019.

Despite the decrease in M&A volume so far this year, here at Prism we have been very busy particularly with deals completing before the Business Asset Disposal Relief (BADR) rate increased in April. We expect this momentum to continue throughout the year and into early 2026, before the BADR rate increases again next April. Additionally, our survey shows that owner-manager confidence is up on last year and 40% of respondents are thinking about selling in the next 2 years.

Trump’s tariffs and other geopolitical turbulence may of course engender some negative concerns among business owners, but we don’t currently see them as having a notable impact on the wider UK SITS sector.

For your free copy of our M&A report, please reply back to the newsletter email from Prim, or complete this form: www.prismcorporatebroking.com/report

Secondly, also for the SITS sector, we are hosting another live webinar on Thursday 19 June called “How To Get Top Value For Your Tech Business”. This is aimed at tech business owner-managers who are thinking about selling within the next few years. If you have B2B software or IT services business, or a related tech / IT business then please do join us. The expert insight and actionable advice in our webinar will help you to make your business more attractive to potential buyers and increase its sale price. Find out more here: www.prismcorporatebroking.com/webinar