The autism therapy space is experiencing significant growth and development, with the number of completed transactions matching last year’s numbers, a marked improvement over the slower years of 2022 and 2023. This growth is seen as sustainable by industry insiders, who attribute it to the maturation of third-party firms that support buyers and sellers in the autism therapy market. These firms have improved due diligence processes, boosting the confidence of all parties involved in transactions.
In the years before and after the onset of the COVID-19 pandemic, there was a lack of experience in autism therapy investment and mergers and acquisitions (M&A) firms, despite a surge in investor interest. Tommy Spiegel, vice president at investment bank Provident Healthcare Partners, highlighted the complexity of autism businesses and the learning curves that companies navigated during deal processes.
While there have been advancements in due diligence processes, there are still knowledge gaps that firms advising on autism therapy deals need to address. Ronit Molko, CEO of Alongside ABA, emphasized the importance of analyzing payer data, quality of earnings, and legal and regulatory compliance in the due diligence process. She noted that there are still areas where diligence experts may miss crucial details, especially in regional nuances that can impact the success of an investment.
Despite these challenges, there has been a positive trend in dealmaking in the autism therapy space. Data from The Braff Group shows an increase in deal activity, with the first quarter of the year being the strongest since 2020. The M&A firm Mertz Taggart also reported that 2025 is on track to surpass 2024 deal totals if current trends continue.
John Hennegan, founding partner of Shore Capital, highlighted the industry’s improved understanding of what is considered normal in autism therapy. He noted that external firms have a better grasp of workforce trends, payer dynamics, and clinical documentation, which has led to more informed decision-making in deal processes.
The role of data in dealmaking has also become more prominent in the autism therapy industry. Provider organizations are investing in robust data infrastructure to track care quality and outcomes, which is essential for successful transactions. As the industry continues to evolve and grow, the focus on data-driven decision-making will be crucial for driving positive outcomes in autism therapy deals. As the addiction treatment and autism therapy industries continue to see increased interest and activity in mergers and acquisitions, it is becoming more crucial for sellers to have well-organized and accurate financial data and documentation. According to industry experts, this is one of the most important steps sellers can take to ensure a successful process.
John Speigel, a representative from an advisory firm that facilitates dealmaking, emphasized the importance of verifying accuracy and strengthening information at the outset of the process. This not only benefits sellers by presenting their organization in the best possible light but also helps ensure a smoother process for all parties involved.
However, despite the efforts of advisory firms to assist sellers in presenting themselves effectively, there are limitations on the improvements that can be made leading up to a potential acquisition. Buyers in the addiction treatment and autism therapy spaces must be diligent in assessing potential acquisition targets, as competition for these organizations is fierce.
Prospective buyers are advised to move at the investment banker’s timeline, as delays or excessive requests for additional information may result in being removed from the process. This highlights the importance of being proactive and thorough in due diligence efforts to avoid missing out on valuable opportunities.
For organizations in the autism therapy space, neglecting investment in administrative and data systems can have significant consequences. Katie Molko, who recently led her organization through an acquisition, emphasized the importance of having the appropriate systems in place to ensure a successful transaction.
Molko noted that organizations with high profit margins are often either out of network with high rates or lack proper systems and processes. Sellers who fail to invest in these areas may find themselves disappointed and at a disadvantage during the acquisition process.
In conclusion, sellers in the addiction treatment and autism therapy industries must prioritize the organization and accuracy of their financial data and documentation to maximize their chances of a successful acquisition. By investing in the right systems and processes, sellers can position themselves for a smoother and more favorable transaction.
