There’s a myth that acquisitions are only executed by huge, publicly-traded, Fortune 500 companies, but that’s simply not the true. In reality, there are many acquisitions conducted by small and middle market firms that are private transactions and are not reported to the media.

There are many reasons to consider acquisitions, regardless of the size of your business. A smaller, highly focused acquisition can grow your company and be incredibly profitable. In fact, small transactions allow you to execute your strategy covertly and avoid alerting your competition to your growth strategy. With a small, strategic acquisition there is less of a risk of integration issues and acquisition failure because the deal is not transformative for the organization. At the same time, a small, strategic acquisition can fulfill a targeted growth need and positively impact a company’s long-term growth.

Another reason people don’t consider acquisitions is because they think they are too expensive. While acquisitions do require a significant amount of financial resources to execute, the cost of organic growth or doing nothing may be higher than the cost of M&A. When looking at the bigger picture, it may be more expensive to develop a new product on your own or take too much time. Companies often use acquisitions to move quickly and implement a ready-made solution. If you are concerned about cost, keep in mind there are ways to mitigate the price of a deal. Only you can determine if acquiring or building your own solution is best, but you should consider both options simultaneously.

Whether or not you decide to grow through external or organic growth, you should consider both as tools, regardless of the size of your company. For every company, unintentionally falling into the trap of doing nothing is dangerous. Innovation, either from external growth or through in-house development, is key to long-term success. Think about companies that lost their edge do to failure to innovate. Blockbuster didn’t adapt from DVD to streaming and lost out to Netflix and Redbox and the once dominant BlackBerry, which failed to compete with iPhone. The cost of unintentionally doing nothing can mean your services and products become obsolete, so make sure you consider your next steps with the future in mind.

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The biggest tech M&A disasters were the Time Warner-AOL $350 billion merger and Google’s $12.3 billion acquisition of Motorola Mobility.  In my observations, the greatest hurdle facing tech mergers is integration. Even where the strategy of the acquisition is solid, if the integration of the two workforces and assets is not executed properly, it will fail.  Even CEO Marissa Mayer, who has made more than 30 acquisitions since joining Yahoo in 2012, may be struggling with integration. Just last week she fired Henrique De Castro, her COO and the person typically responsible for integration.

Lessons Learned From Integration Struggles

Warning signs of the Time-Warner AOL disaster began with the press release they put out after consummating the deal. It contained lots of flowery language, but left everyone scratching their heads as to why the two companies were merging. There was also a culture clash. Executives struggled with integrating an up-and-coming young tech company with an established media mogul. Eventually, in 2009, Time Warner had to dispose of AOL.

Google’s purchase of Motorola Mobility in 2011 also failed to meet expectations and Google announced on January 29, 2014 it would sell the acquisition to China’s Lenovo. This loss-making division was supposed to usher in an era of new devices built entirely by Google. Unfortunately, Moto X, Motorola’s smartphone, performed poorly in comparison to comparable devices. Google’s failure with Motorola was partly due to issues with integrating Motorola with Google’s existing hardware division and with the company as a whole.  Perhaps Lenovo will have more success.

Amazon M&A Proves Bigger Is Not Always Better

The moral we can draw from this is that bigger is not always better. Although big acquisitions are the most visible due to widespread media coverage, they often fail to be truly successful.

Amazon provides an instructive example. Between 1998 and 2001, Amazon approached acquisition the wrong way, buying or investing in 29 companies across various industries from toys to car dealerships to financial services. Most of these acquisitions failed and Amazon’s stock plummeted from its peak at $106.69 on December 10, 1999 to a low of $5.97 in on September 28, 2001.

However, since 2004, Amazon has refocused on making smaller, strategic acquisitions. This is what I call “taking frequent small bites of the apple.”

Its most recent acquisition of social media site Goodreads, valued at $150 – $200 million, was tiny compared to Time Warner-AOL or even Google-Motorola. However, with Goodreads Amazon can build on its personalized recommendations and gain access to book fans. Amazon acquired TouchCo in 2010 for touch screen technology now used in Kindle Fires.  Building on this capability, Amazon acquired Liquavista, a mobile display technology company, in 2013. Amazon’s stock price is now $403.01 (as of January 30, 2014).

Small, strategic acquisitions allow companies to “digest” and integrate the entity. In all acquisitions, the devil is in the details. Although your strategy may be solid, if you don’t make sure all the pieces fit together, your acquisition is bound to fail. At the end of the day, companies, even tech companies, are made up of people. It is the people, more than the systems or technologies,that present the biggest challenges of integration. To overcome these, you need a strong leader with the wisdom and experience to combine different cultures while overseeing the operations of a newly merged company.