M&A season is back. And this time, ordinary investors can enter.
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Tom Young is here with your Sunday digest.
In the 2000s, an acquisition was the ultimate symbol of startup status.
Wiz… nest… Deep Mind… Fitbit…
One by one, giants swallowed up such promising companies in technology Alphabet Company (Google) and Meta Platforms Inc. (dead)And turn their founders and early employees into millionaires. America’s five largest technology companies made at least 616 purchases worth between $1 million and $50 million in that decade alone, according to the Federal Trade Commission. Hundreds more occurred outside that narrow window.
Mergers and acquisitions exits have become so essential that HBO built a TV series around them. Successful offer Silicon Valley I followed a founder who kept turning down, feeling, and blowing opportunities for money because he wanted to build something bigger.
The AI revolution is now creating a new wave of M&A exits. Only this time, many of the takeover targets are publicly traded companies that ordinary investors can buy first, rather than sending out a job application hoping to become employee No. 3 at a company like DeepMind.
Many of these things happen at great prices. when Radnet Company (RDNT) Bought AI cancer detection company ICAD In July 2025, shareholders received a nearly 100% bonus overnight. Adobe Company (ADBE) Buy an AI-powered digital marketing company Samrush It occurred at 78% encoding.
Even “disappointing” deals close at 20% premiums – an immediate gain that typically takes the S&P 500 two years to achieve.
Now, Senior Analyst InvestorPlace Luke Lango He believes he has found a way to get into these AI investments early, with the potential to pay greater returns. And in a new free offer, the Megadale 2026 eventHe explains his step-by-step method for setting these targets, and how to buy these companies before anyone else enters.
The show airs July 30 at 1pm ET, and you can subscribe here.
To show why timing is important, I’ll walk you through five companies that look ready to buy. AI is redefining technology, and cash-rich incumbents are about to spend huge sums to stay relevant.
Cybersecurity: Where buyers are hungriest
The most crowded corner of the current AI market is Cyber securityan area that is rapidly being integrated into AI platforms themselves.
Both sides have an incentive to get deals done. AI companies want to buy because security companies have the data they need. They know that their AI security products will be only as good as the data they were trained on.
On the other hand, smaller cybersecurity companies are under pressure from two sides: from new entrants to the AI space, and from end-to-end integrators like Fortinet Inc..Fascinated) and CrowdStrike Holdings Inc. (Raw) increasingly favored by IT departments. For medium-sized players, this leaves two options: sell out or increase volume quickly enough to compete.
Most will choose the first way out. Segment valuations are low (ironically due to fears of artificial intelligence), making it difficult for smaller players to raise money and work their way up to department store scale. Moreover, high-profile cybersecurity concerns make AI labs even more motivating for buyers. Last week, a rogue OpenAI agent hacked another AI startup, highlighting the critical need for high-quality cybersecurity.
Here are the three public companies that I think are most likely to take a hit from M&A seekers:
Tenable Holdings Inc. (temperature): This vulnerability management (VM) company was exploring a sale As early as 2024 After obtaining the benefits of the acquisition. A deal seems more likely today, because Tenable is a leader in internal IT scanning that defends against attacks orchestrated by artificial intelligence.
Tenable also provides steady cash flows and carries zero net debt — catnip for private equity firms like Thoma Bravo and Permira. Integrators such as CrowdStrike may also participate. And make no mistake: possession is the best outcome here. Tenable is stuck between AI startups and one-stop shops, and its path as an independent company is (appropriately) untenable.
Rapid 7 Company (RPD): This Boston-based cybersecurity company is on its way to being sold. Rapid7 is a smaller VM company than Tenable, and activist investor Jana Partners had pushed for a deal in 2025. The two sides eventually settled that year with Jana adding three board members and Rapid7 promising a turnaround. This was not enough. In March 2026, the activists reached a new agreement to raise their stake in Rapid7 to approximately 20%. Three months later, Jana replaced the outgoing CEO with one of the three board members.
When an activist leads in this way, the destination is usually the next available exit. With many AI companies moving into vulnerability management and Rapid7’s stock so low, the company will have no shortage of potential suitors.
Sentinel One Company (S): This Silicon Valley cybersecurity company, with roots in Israel, is the largest on our list by a wide margin, with a market capitalization of $6 billion. It is also likely to be acquired by a strategic buyer.
In July 2025, reports emerged that Palo Alto Networks Inc.Bano) was seeking to acquire SentinelOne, which has been in hot political heat following the hiring of Chris Krebs, the former head of the Cybersecurity and Infrastructure Security Agency (CISA). Krebs had a major falling out with the US president over allegations of 2020 election fraud. A week later, the Palo Alto company purchased a different Israeli cybersecurity company, CyberArk, and denied that it had seriously considered buying SentinelOne.
However, SentinelOne forced Krebs out anyway, positioning itself as a more attractive takeover target. Cisco Systems Inc. (cisco) is a logical suitor, now that the antitrust risks have receded. Its endpoint security products track poorly with SentinelOne’s products. Alphabet’s $32 billion acquisition of cybersecurity company Wiz shows that big tech companies are also willing to pay for security.
Best of all, SentinelOne has the largest moat among the three cybersecurity names here. Even if no offer ever arrives, the company must continue to grow on its own. Either way, shareholders win.
Artificial Intelligence Programs: Vibe Coding Compression.
The other hotbed of M&A activity is AI software – targeted by both AI companies and traditional software-as-a-service (SaaS) companies striving for more exposure to AI.
The sector has already seen some high-profile acquisitions. For example but not limited to:
- LifePerson Inc. (LBSN) (Conversational AI) acquired by SoundHound AI Inc. (Suwon) for a 22% premium
- Publicis Groupe acquires LiveRamp Holdings Inc. (slope) (consumer data) at a 30% premium.
- Al Kamal Company (Performance) (Artificial Intelligence in Fashion) is set to go private for a 48% premium.
The pressure to sell is only building. Advanced artificial intelligence now makes emerging competing “vibe code” products possible, often designed in a fraction of the time and cost. Many software CEOs will find it more attractive to go out for double-digit compensation than to fight an endless wave of imitators.
Here are two options to purchase:
Bell Holding Company (invoice): The Silicon Valley payments company has been targeted by three separate activist investors since October: Starboard Value, Elliott Investment Management, and Barrington Capital Group. Everyone has basically said the same thing: either become more profitable or sell yourself to someone who can make it happen.
Bell tried to do both. Analysts now expect a 19% increase in earnings per share this year (up from 4% in 2025), and another 27% increase in 2027. Meanwhile, the payments company has been marketing itself to at least one buying group, Hellman & Friedman. With stock prices now down 18% since January and earnings estimates rising, BILL is the best software option for an AI enthusiast to choose.
Black Line Company (PL): One analyst recently called BlackLine the “cleanest takeaway” for 2026. I agree. The AI-powered accounting software platform is a particularly popular add-on for SAP SE (Sub), which had already made a bid of $66 per share for BlackLine in June last year. The German company was considering raising its offer last October after BlackLine’s board of directors rejected the offer, describing it as too low.
Two factors now make a takeover almost certain.
- Cheaper price. BlackLine’s stock price fell below $30 in the broader SaaS selloff. At these levels, it would be impossible to reject a new offer of $66 per share. Even an offer of $50 per share may be acceptable to the board.
- Reconstructed panel. After SAP’s rejection, activist investor Engaged Capital threatened a proxy fight. In the March 2026 settlement, BlackLine added two new directors (including two M&A bankers) and explicitly gave the strategy committee the ability to negotiate the sale. BlackLine founder Therese Tucker also retired last month, paving the way for an exit.
This makes BlackLine a particularly attractive target for larger traditional business software companies seeking to leverage AI. The company was an early adopter of agentic AI in accounting, making it the perfect product for a legacy software company.
How to actually play the AI Merger Boom game
In the 2000s, even wealthy accredited investors couldn’t afford a seat at the M&A table. Larger venture capital funds such as Sequoia, Benchmark, and a16z have been closed to retail investors, and institutional cash has often had difficulty accessing these oversubscribed funds.
Everyone had to wait for startups to go public… and hope they wouldn’t be bought by big tech companies first.
This means lower returns for ordinary investors. Here’s how investors in the ride-sharing company are doing Uber Technologies Inc. (Uber) Their performance depended on the time of their arrival, assuming they have survived to this day:
- Seed (2010). The first round was purchased at approximately $0.009 per share, a return of 770,000%.
- Series A (2011). The index was purchased at approximately $0.13 per share, a return of 54,000%.
- Series B (2012). Bought from Menlo Ventures at $0.65 per share, a return of 10,000%.
- Series C (2013). Bought Google Ventures for $5, a 1400% return
- Secondary Market (2018). SoftBank bought the shares at $32.87, a return of 112%.
- IPO Investor (2019). Bought at $45, 56% return
Proceeds evaporate with each financing round. The early investors are the biggest winners, while later investors start competing for the leftovers. The AI-powered M&A boom will go the same way, which is why getting in at the right time is so important.
Fortunately, this “good” time is within reach of ordinary investors. In his next show, Megadale 2026 event On Thursday, July 30, Luke Lango reviews his system for identifying the next AI superstars before anyone else, and how to land those promising deals.
Reserve your place for this free event here.
Until next week,
Thomas Young, CFA
market analyst, Investor location
