Business Acquisition Strategy

The discussion centers on the acquisition strategy of Vern, a software holding company, which focuses on purchasing companies that exhibit product market fit and strong annual recurring revenue (ARR). Initially, the company targeted smaller firms with around $200,000 in ARR but has since shifted its focus to those with a minimum of $1 million in ARR, ideally within the vertical market software space. Vern has successfully acquired three companies, including those categorized as 'venture orphans,' which refers to businesses that struggled to secure additional capital after earlier funding rounds. This strategic evolution reflects a broader trend of focusing on established companies with existing customer bases rather than newly launched startups, which tend to face higher risks and challenges in achieving growth.