5 M&A Predictions for 2026 (From 2,500+ Business Sales)
Updated on February 24, 2026
Transcript
Hey everyone, it’s Greg, and today I’m going to discuss five different M&A predictions from our new industry report.
If you’re not familiar with us, we’ve sold over 2,500 businesses and made over 90 people millionaires as an M&A brokerage. I just compiled a ton of data for the last year. Last year, we sold 161 businesses, which is actually up from, I believe, 146. If you want the actual numbers, you can go download our industry report. It’s not out yet, but it will be soon, so join our email newsletter.
If you want to download it now, you can find it in the link in the description down below if we have published it by the time this video comes out.
With that said, things are in an interesting place. It’s still a rough market, it’s still a struggle to get deals done, but unlike 2024, it’s been a much easier year—in quotations—to get deals done. I put them in quotations because we still have to really represent our sellers. We really have to meet where the buyers are, and we really have to help sellers get to where they need to be in order to actually transact a deal successfully.
But I am pretty cautiously optimistic for 2026 that the M&A market is going to continue to see a good recovery, even in the digitally native businesses that we specialize in.
With that said, let’s talk about my predictions.
Prediction number one: I believe faceless YouTube channels are going to become much more popular as assets that people buy and sell.
Now, over the last couple of years, we’ve seen affiliate sites really take a big wound to the stomach as Google’s algorithm started getting crazier and crazier. AI has come on the scene and has really rocked the boat for pretty much all the content-based business models. But one that seems to be sticking around pretty well is faceless YouTube channels.
Faceless YouTube channels might start filling that role that affiliate sites used to have in a bigger way than they even did in 2025. And part of that is the advent of AI. There are more and more channels getting started using these AI tools, and the AI tools themselves are actually getting better and better and better.
I think this is going to be a place where a lot of beginner buyers—newbies to the M&A world who just want to dip their toes to buy a profitable asset—will probably start. Because, similar to affiliate sites, YouTube channels are also very beginner-friendly. There are just not that many moving pieces to them, right? You create the content, you optimize it for the algorithm, and happy days—you get the AdSense revenue.
Now, I will say, as I always say when I bring this up (and something I said for years with affiliate sites too), if you are going to be buying a YouTube channel—or even building one, for that matter—I always recommend that YouTube can be the start of your focus. But you really should be building a business that doesn’t purely rely on YouTube. Because if you do, you’re going to find yourself eventually in a similar position as the affiliate site people found themselves in.
Either when Amazon decreased their affiliate fees—which a lot of these type of businesses relied heavily on via the Amazon Associates program—or when Google SEO changed dramatically in terms of presenting content sites, where they lost almost all their traffic.
So I think these are great little businesses. I think you can actually sell pretty big ones. I think we came close to a seven-figure business in that space earlier last year. But you should always be thinking ahead.
If you are an acquirer of faceless YouTube channels, it’s okay to buy one that is just always going to be a YouTube business. I’m not saying that is wrong. But if you want to be less risky, I would recommend looking at faceless YouTube channels where you can grow beyond just YouTube.
If the channel is about health and fitness, is there a possibility for you to make a digital course? Is there a possibility for you to sell a high-ticket service on the back end of that, where that organic YouTube traffic becomes a marketing channel for your real service?
That is what I always recommend. The more you can control your own business and control all the different levers—and owning your own offer allows you to do that probably better than almost anything—because now you suddenly have the profit margin to go and explore all these other marketing channels that are happening right now.
But with that said, I do think YouTube channels are going to continue to explode in popularity in 2026.
Prediction number two: valuations in 2026 will stabilize, or maybe potentially start ticking back up a bit.
Which is great because, like, if you’re selling your business, of course you want to get as much money as humanly possible, right? Within reason, of course. We still want to make sure our buyers are getting a good deal too.
But this stabilization comes pretty much after almost three years of decline when it comes to M&A assets—at least digital, digitally native assets like what we sell. And this decline was, in a lot of ways, not so much the market falling out as much as the market correcting back to normal.
What I mean by that is we have come down from this massive COVID bump that way overvalued a lot of these digital businesses. And in 2025, it didn’t go down noticeably in any massive, terrifying way. In some cases, we sold deals higher than average—higher than normal—even surprising us at times.
So I think in 2026, we’re going to see these continue to stabilize, and valuations might tick back up. Because in 2025, what we saw was a lot more buyer interest coming back onto the market.
Now, buyers were more hesitant in terms of what they choose to look at and the kind of deals they were making. But overall, we saw more buyers come onto our marketplace in 2025 than we did in 2024, which tells me that the appetite is starting to come back to go and acquire these assets.
Of course, more demand and less supply should increase prices if that demand keeps growing—which I think it will in 2026. Now, there is a caveat to me saying that, which I’ll get into here soon, but this is very good news for sellers.
As long as you, as a seller, come in with realistic expectations of what your business is worth, you have a very good chance of selling your business in 2026 and potentially becoming one of the millionaires we’ve helped make over the years.
Prediction number three: service businesses go through a profit margin renaissance.
I’ve been saying this for most of 2025—at least half of the year. I’ve been saying it to my friends who own marketing agencies, and even to my offline friends that just own more traditional service businesses.
Historically speaking, service-based businesses were always very labor-intensive—like Empire Flippers. We’re a very labor-intensive company, right? We’re M&A advisors, we have vetting, we have customer service, we have a sales team, we have a marketer—all sorts of people. That really shrinks the profit margin.
But in 2026—and I think we already saw a lot of this in 2025—I think these service businesses, especially marketing agencies, are going to see a big boom to their profit margin. And the reason why is because of the elephant in the room, which you know what I’m about to say: artificial intelligence. All right, it’s AI.
So I see AI coming in and really changing the game. And not just AI, obviously, the banner child here, but also automations are getting better too, and these two things are often lumped in together anyway.
There are things coming out like AI SDRs, AI account—there’s AI customer service, chatbots. And so a lot of the money that used to go to labor, whether it’s low-pay or high-pay labor, is suddenly now free because AI can do a lot of these things now.
There’s always the argument, “Well, can it do it well?” Maybe humans will probably almost always be better than AI if they’re trained and skilled at the job. But you don’t always need the most skilled person to get the job done.
In fact, I’ve used AI to help me speed up writing my industry report. Now, every word in that report is written by me, but I used a first draft to look through it all, get more ideas, and get more clarity on what I was trying to write, which allowed me to write this a lot faster than what I’ve written in years past.
If you’ve ever downloaded one of my industry reports, they’re pretty big—well over 5,000 words typically. I think the biggest one I did was like 15,000 words. It’s almost a novella on the industry. So it’s a pretty Herculean task.
I think the explosive increase in quality is probably going to slow down. But as business adoption grows more and more with AI, I see service businesses having an absolute renaissance when it comes to their profit margin.
Prediction number four: I mentioned valuations and a caveat. It’s actually two caveats, and four and five are kind of related in terms of my predictions.
Number four is micro SaaS is going to be threatened more by AI in 2026.
Right now, there are tons of businesses that are paying every single month for all kinds of bespoke and niche SaaS tools, some of which only serve one purpose—to do a certain thing that the entrepreneur needs done.
I think in 2026—because we already saw in 2025—more and more of these entrepreneurs are either going to vibe code their own solution themselves or hire an engineer who vibe codes one for them really, really quickly and get rid of those monthly payments.
There are also private equity funds that have started to pick up some steam. I don’t think they have become mainstream by any means, but they’ve certainly gotten some attention. Basically, their whole premise is: let’s rebuild SaaS tools that people love, where they only have to pay one time and they can host themselves.
And I see this continuing to be a trend. You look on AppSumo, there’s tons of software coming out of the gate, out of nowhere, that’s pretty good, that is all AI-created, and it’s lifetime deals—a one-time purchase.
This could be a real threat to the whole dream of SaaS, which is a recurring revenue piece. Because why would someone pay every month when they can just use something like Cursor and some general knowledge that they can augment with Claude to tell them what to do to build their own little software app—if they’ve got the time to do that?
I think it’s pretty clear to me that micro SaaS is not going to be extinct in 2026. You can still build them, it can still be a great asset, you can still sell and buy them. But I do think they’re going to be more under threat.
Which leads me to my next prediction.
Prediction number five: AI valuations may not pop in 2026, but they might start deflating a bit.
Over the last couple years, we’ve seen AI businesses get absolutely insane valuations—more so than even SaaS valuations, which was usually always the king of this when it comes to what businesses sell for the most. It’s almost always SaaS.
I think there will be a default inflation here because at this point, investors have already spent hundreds of millions of dollars. In some cases, like a billion dollars—like Meta just acquired Manas for a pretty penny thing. That was the fastest exit at that level of acquisition in history. I could be wrong on that—go fact check me.
What I’m trying to say is these investors have already spent all this money. Now they’ve acquired, and in some cases, they’ve had these acquisitions for almost a couple years at this point, which might be the breaking point that starts putting the actual brakes on the valuations of AI.
Because as it starts seeing the return isn’t as good as they initially thought, the profit is still not there. And some of these big companies, like OpenAI, just had a whole controversy of like they’re not doing too well in the P&L.
So I think a lot of these AI softwares are going to be in that space. Also, OpenAI or Claude—if they start trying to go towards real profitability, there’s a good chance that the price of the AI tokens will probably increase to try to compensate and actually get a profit margin going there, which in turn will be costs that are passed down to the entire user base—the entire stack.
And since a lot of these AI tools—at least the ones that my friends in my space are making—are in a lot of ways just wrappers (they’re API wrappers of ChatGPT, of Claude; I think a couple of them are Grok now as well), if you increase the price of the tokens, that can fundamentally change the economics of these AI software startups as well.
They’re primarily utilizing one of these big LLMs—or all the LLMs combined—and that could really rock their world.
But if this prediction is true, I actually have some very, what I consider, wise advice for my friends out there watching this who are building AI tools. And that is: you need to either build your AI business so fast that you can sell at a premium this year.
I think this might be one of the final years where you can get a really crazy valuation on even a ChatGPT-wrapper software—as long as you build a little bit of a moat with your marketing and kind of your infrastructure.
Or the second option: you need to go raise an obscene amount of money so you don’t become obsolete.
Which I think is the other big elephant in the room for people building in this space, because the technology is moving very, very quickly. I think the next big jump is probably going to be longer than a lot of people think. But these little tiny improvements—where a lot of these improvements are the basis of these smaller AI businesses, where they tweak something that the LLM doesn’t do normally—the LLM could just come out with a feature that does that.
I have a friend—this was a couple of years ago—he built a little chatbot business using AI up to like 25K a month. Then I think it was OpenAI that absolutely crushed him when they unleashed a feature, basically for free, that did the exact same thing as his business. And that business was wrecked basically overnight.
And I think there’s a real potential threat here that that will happen continuously, even if we don’t see a big marked improvement in the AI quality over the next year or so.
This is a double-edged sword. People in the AI space, I think they’re most under threat by this type of mentality. But people that are in the e-commerce space, in the marketing agency space—I already mentioned the service profit renaissance that might be coming up—I think you guys are in a very good position here.
Because unlike the people that are building an AI startup, you’re just using an AI tool. So it might be a pain in the butt to switch, but it’s pretty easy to switch, all things considered—relatively speaking—to the better AI when one comes out.
So you get the advantage of always being able to use the best in class, rather than having to invest all this time and money and R&D into trying to remain best in class. Because if you’re not best in class, there’s a good chance you’re going to get eaten up by someone else who did.
I think there’s other stuff that’s going to happen. I think there’s going to be a continued increased interest in DTC e-commerce.
We’ve had a weird year when it comes to global logistics, with tariffs that are going on and off and on and off. And I thought that was going to be a big problem for us in 2025—and it was, don’t get me wrong. There were problems with it, but it was nowhere near as big as I thought it was going to be.
I thought it was going to affect us much more deeply than it did. And hey, we sell a ton of e-commerce stores—both DTC and Amazon FBA—so anyone who’s going to get super affected by this should have been us in terms of the brokerage.
And there was a little bit of that, not going to lie. There were people who pulled out because of it. Buyers were uncertain. Some sellers decided not to sell because they didn’t know how to handle the changes to their P&L basically with the different tariff charges.
But as 2025 ended, looking back on it, it wasn’t as crazy as I thought it was going to be. We still got a lot of deals done. We sold more deals in 2025 than 2024. So obviously there’s still a lot of buyer interest, because the majority of businesses we sell tend to be physical product businesses.
And I think in 2026, we’re going to see that continue. Despite the media, the rhetoric, the on-and-off-again tariffs, entrepreneurs are nothing if not incredibly adaptable. And I have high faith that we’re going to sell more e-commerce stores in 2026.
All right, so those are my predictions, with a little bonus one there at the end.
If you want to read my industry report, like I said, if it’s published by the time this video comes out, you’ll be able to find the link in the description down below. If not, and if you’re not subscribed to our email newsletter, go ahead and subscribe.
You’ll get a weekly email from us called This Week in M&A that covers the high-level news of the industry right at your fingertips, and you will be the first one to hear when the industry report goes live.
Talk to you soon.
