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INORGANIC GROWTH STRATEGIES

Someone asked on Aug 18, 2018 - 3 answers

The inorganic ways to grow refers only to M&A?

Can also state Joint Venture, Partnerships, Collaborations ...?

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Anonymous B replied on Aug 19, 2018

Some other ideas...white label, license agreement, outsourcing

Vlad replied on Aug 18, 2018
McKinsey / Accenture / Got all BIG3 offers / More than 300 real MBB cases / Harvard Business School

Hi,

The criteria for inorganic growth is if the deal has the equity component. Simple marketing partnerships are the means of organic growth.

Inorganic growth can be done in two ways:

  • Vertical - M&A, JV, etc with suppliers / distributors / retailers
  • Horizontal - M&A, JV, etc with the players in the same market

Best!

Hemant
Expert
replied on Aug 18, 2018
Current partner @ Andreessen Horowitz (VC firm). Ex-Mckinsey, ex- strategy guy at Google.

Organic growth just means growing the company's capitalization by using its internal resources that sits either above the line (COGS) or below (Ops) in the P&L. Inorganic is growing the capitalization by all other means, usually M&A, JV, and partnerships that involve some form of revenue share. I wouldn't call all partnerships "inorganic", especially channel partnerships where the channel is a VAR / value added reseller.

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