Key Areas to Watch After an Acquisition

Switching to a new software platform is always risky, but doing so with a provider that has just been acquired by a larger company amplifies that risk dramatically. When ownership changes hands, the acquiring company’s focus is often on restructuring, cost-cutting, and integrating systems, not on safeguarding your needs as a client.

During acquisitions, client needs often take a back seat to internal changes, leaving you exposed. Choose providers that are stable, focused, and invested in your success, not distracted by corporate upheaval.

Some studies show that IT projects average 27% over budget, and 1 in 6 fall into complete disaster with 200% cost overruns and huge delays often going 70% over schedule or more. These failures aren’t just inconvenient, they can destroy careers, cripple operations, and even sink entire businesses.

To protect yourself, you must approach these transitions with eyes wide open. The following seven key areas will help you ask the right questions, spot red flags, and safeguard your investment before you commit to a provider whose focus may no longer align with yours. The Software Risk Map helps you track the typical workflow you can watch for during this acquisition stage and know when to perform your checklist items.

1. Ownership Transition Timeline

Changes to a platform rarely happen on day one. Most take shape after the first year, when integration plans are finalized.

If you sign on with a company that’s just been bought by a larger one, be prepared to wait, possibly for years, before you become a real priority. During acquisitions, the new owner’s focus is on merging systems, people, and processes, not on supporting new clients. These integrations can take 18 months or more. Even more alarming, McKinsey & Company reports that 30% of large acquisitions face delays that can add up to another 15 months before work even starts.

That means you could be left waiting nearly three years before your implementation and needs are addressed, a costly gamble, especially if you’re a new client depending on timely support.

Recommendation: Track the official acquisition date and ask when changes are expected. This will help you prepare and plan resources for any required transitions.

2. Strategic Fit of the Acquiring Company

If the acquiring company’s core business is not utility billing, or they offer a competing billing product, your system may become a lower priority.
Recommendation: Review their product portfolio and corporate focus. Ask how utility billing fits into their long-term strategy.

3. Product Continuity and Roadmap

Post-acquisition, the product roadmap, features, or even the branding of your software may change.
Recommendation: Request a formal roadmap presentation and written confirmation of ongoing support for your current platform.

4. Customer Support Model

A larger company may consolidate support teams, reducing the responsiveness you’ve come to expect.
Recommendation: Ask about support transition plans, service level agreements (SLAs), and whether your existing support contacts will remain available.

5. Migration Pressure

You may be encouraged, or even required, to move to a different platform or interface that is unfamiliar to you and clunky.
Recommendation: Secure written commitments on service continuity, data migration assistance, and migration timelines before agreeing to changes.

6. Pricing and Licensing Changes

New ownership often means new subscription models, bundles, or licensing terms, which can lead to unexpected cost increases.

If your software provider has just been bought by a larger company, be prepared that your costs could rise faster than before. A 2024 study by Blue Ridge Partners found that large software companies raised prices nearly double by an average of 8.4%, compared to only 5% for smaller providers.

Along with steeper price hikes, big companies often lack the specialized knowledge and personal attention that niche providers can offer. In other words, you could end up paying more while getting less.

Recommendation: Lock in current pricing where possible and request full transparency on future fee structures.

7. Compliance and Security Requirements

Government systems must meet strict compliance and security standards. If these certifications are not confirmed under the new ownership, you could face regulatory risks.

CISA’s Software Acquisition Guide points out that acquisitions should raise red flags for buyers because they often involve major compliance and security concerns. Even if you understand the basics of cybersecurity, you may not be able to tell whether the supplier is truly meeting current security standards.

In larger companies, the risk grows: responsibility is spread across multiple teams and outside partners you may never deal with directly, making it harder to know who is accountable, or if security gaps are being addressed at all.

Recommendation: Request official documentation proving compliance with all applicable municipal, state, and federal standards.

Steps to Protect Your Organization

To safeguard operations and ensure continuity, municipal IT and operations teams should:

1. Document Commitments: Get all assurances in writing, including support, pricing, and roadmap promises.

2. Secure Data Rights: Ensure your contract guarantees full, on-demand access to all billing records in usable formats.

3. Evaluate Alternatives: Keep a list of potential vendors in case the trajectory shifts away from your needs.

4. Plan for Change Management: Prepare staff for possible workflow or user interface changes.

5. Monitor Early Warning Signs: Watch for slower support response times, delayed updates, or sudden pricing changes.

Final Thoughts

You don't know what to expect during an acquisition regarding your utility billing software's quality and value, you should be vigilant. Transparency in early stages is normally low, but municipalities and other companies dealing with utility billing have a responsibility to seek clarity and protect critical public service systems.

By asking the right questions, securing written guarantees, and preparing for multiple outcomes, you can keep your operations stable, your data secure, and your community well-served, no matter how the acquisition unfolds.

Next Steps:

• Review your current vendor agreement today and start documenting the questions you need answered before the acquisition changes take effect.
• Don’t get caught off guard during a software acquisition. Download our Post-Acquisition Software Risk Checklist to know exactly what questions to ask and what steps to take to protect your municipality’s operations.
• Experience how a utility billing solution built exclusively for utility billing delivers superior performance, support, and long-term stability. Schedule your personalized demo today and see the advantages for yourself.