Guide · Buy-and-build

Buy-and-build in the DACH Mittelstand

How a platform and a series of add-ons become a group, how to tell whether a platform can carry that growth, and why Germany, Austria and Switzerland (DACH) still trail the Nordics on add-ons.

As of 9 November 2026 · 9 min · Nick Herbig

Enquire about a mandateRead the figures
Example group · Maintenance, StuttgartSites
  1. Step 00Platform, 6 sites in Baden-WürttembergBase
  2. Step 01Refrigeration, Bavaria+3
  3. Step 02Ventilation, North Rhine-Westphalia+2
  4. Step 03Building automation, Saxony and Thuringia+3

Schematic example. Austria and Switzerland are still open.

VIENNA · OPENZURICH · OPENPlatform6 SITESCooling+3 SITESVentilation+2 SITESBuilding automation+3 SITES

01 · At a glance

Buy-and-build means buying a platform and growing it into a group through a series of add-ons.

The group pools administration and purchasing, while the companies it buys keep their core business. In Europe, add-ons now make up most private equity buyouts. Mittelstand refers to the owner-managed mid-sized companies that shape the economy of Germany, Austria and Switzerland (DACH). The glossary has a short definition of buy-and-build, and the search for a platform and add-ons starts with deal origination.

71.4%

of European PE buyouts in Q1 2026 were add-ons to an existing platform, a ten-year high

PitchBook, 8 Apr 2026

67.4%

add-on share of all European PE buyouts in full-year 2025

PitchBook, 8 Apr 2026

41%

of PE-backed companies in DACH made add-ons from 2019 to 2024, against 55% in the Nordics

PwC/Gainpro, Mar 2025

2.7x

faster revenue growth with more than five add-ons than with none (median)

PwC/Gainpro, Mar 2025

02 · Definition

How buy-and-build differs from a roll-up

Both routes lead to a group. A buy-and-build starts with a well-developed platform that is added to step by step. A roll-up brings many small companies together quickly.

Two routes to a group · schematic

Distinction based on PwC/Gainpro, Mar 2025

Buy-and-build

PlatformWELL DEVELOPEDAdd-on 1own diligenceAdd-on 2own diligenceAdd-on 3own diligenceOVER THE HOLDING PERIOD

A platform with management and systems that suitable companies join one after another. Each add-on has its own due diligence and financing.

Roll-up

One unitCOMBINED QUICKLYstandardised due diligence

Many smaller companies are brought together quickly to gain market share, usually with standardised due diligence.

Platform

The first investment, around which the group is built. It needs management, systems and scale. Platform acquisition in the glossary

Add-on

Every further acquisition, usually smaller than the platform. It fills a gap in region, service or client segment. Add-on acquisition

Group

The result is shared administration, several sites and a higher value at exit. In practice the line to a roll-up blurs, but the question of whether the platform can carry it remains.

03 · Market

Seven in ten European buyouts are add-ons

Since the start of 2026, investors have preferred building out existing platforms to buying new ones. The German-speaking region makes fewer add-ons, and less often, than the Nordics.

Out of 10 PE buyouts in Europe

PitchBook, 8 Apr 2026
202567.4%
Q1 202671.4%
Add-on to an existing platformnew platform or standalone buyout

Share by number of deals. Q1 2026 is the highest figure in ten years.

DACH compared · 2019 to 2024

PwC/Gainpro, Mar 2025

Share of PE-backed companies with add-ons

Nordics55%
DACH41%

Add-ons per company

Nordics4.7
DACH3.1

The latest analysis that reports DACH separately.

Revenue growth by number of add-ons

PwC/Gainpro, Mar 2025
0%5%10%15%20%7.6%no add-ons10.8%1 to 315.9%3 to 520.4%more than 5Number of add-ons per companyabout 2.7x
Median annual revenue growth over five years (CAGR), PE-backed companies. Source: PwC, “Unlocking value with buy-and-build strategies in the DACH private equity market”, March 2025, p. 4 (data: Gainpro)

Companies with more than five add-ons grew at a median of 20.4% a year, against 7.6% for those with none.

That is a correlation, not proof. Groups that buy a lot often have a strong platform and access to capital from the start.

Why the share is rising

Add-ons are smaller and less risky than a new platform. In uncertain markets, investors stick with what they already hold.

What sets DACH apart

Fewer PE-backed companies make add-ons, and those that do make fewer of them. PwC calls the market fragmented and sees untapped potential in that.

What follows

If you hold a platform in DACH, you will find many possible add-ons that nobody has approached yet. The EBITDA multiples for the DACH region show how size affects price.

04 · The model

One back office for four companies

Buy-and-build pools what each company otherwise runs on its own. Quality management, back office, purchasing and IT then run once for the whole group. Core business, clients and name stay where they grew.

Group · Structure

Schematic, not a real group
2418126
admin functions, per companyshared across the group
  1. 01

    Four companies, four back offices

  2. 02

    Connected one company at a time

  3. 03

    One back office, 14 sites

Platform

Maintenance & repairCore · 6
QM
Back office
Sales
Purchasing
Recruiting
IT

Add-on 01

RefrigerationCore · 3
QM
Back office
Sales
Purchasing
Recruiting
IT

Add-on 02

VentilationCore · 2
QM
Back office
Sales
Purchasing
Recruiting
IT

Add-on 03

Building automationCore · 3
QM
Back office
Sales
Purchasing
Recruiting
IT

What gets pooled

Quality management, back office, sales, purchasing, recruiting and IT. Each function then runs once for the whole group instead of in every company.

What stays local

Core business, clients and name. The former owner often runs their site for a transition period.

What it requires

A platform that can take on administration for others. The next section shows how to recognise one.

05 · Spotting a platform

How to tell whether a platform can carry a group

The question is not whether a company is good, but whether it can carry others. It becomes clearest when you mentally add one more site.

Stress test · one more site

schematic
  1. 01

    Imagine one more site

  2. 02

    Where the site connects

  3. 03

    What depends on the owner

Company A · everything sits with the ownerExample
NEWSITE 1SITE 2SITE 3SALESPROC.TECHACCTSHROwn.
Reporting directly to the owner89
Systems the site has to connect to4
Add-on relative to the company60%

Good company, weak platform. Often a fitting add-on for another group.

Company B · second management tierExample
TECHSALESSITESNEWOwn.
Reporting directly to the owner3
Systems the site has to connect to1
Add-on relative to the company20%

Can carry a group. The new site has a place to go, and the owner stays free for the next decision.

Two schematic companies on the same scale. What size is enough depends on the investment thesis.

Second management tier

Sites, sales or technology run without the owner. Without this tier, the group grows only as fast as one person can decide.

Systems that scale

Accounting, controlling, scheduling and IT take on another site without being rebuilt. Due diligence will show this at the latest.

Enough scale

Add-ons stay small enough beside the platform to be integrated. What size is enough is set by the investment thesis, for example in a search mandate.

06 · Add-on

A good add-on fills a gap

An add-on pays off when it brings something the platform lacks, such as a region, a service or a client group. A second site where there is already one rarely adds much.

Gap profile · region × service

schematic

Candidate A · fills three gaps

Candidate B · duplicates what is there

Platform coversAdd-on brings newAdd-on duplicatesopen

Region, service, clients

The gap is defined in the investment thesis. The search runs against that profile, not against whatever happens to be for sale. Add-on sourcing shows how this becomes a running pipeline.

Smaller than the platform

An add-on has to be easy to integrate and does not need group-level administration of its own. A well-drilled team and loyal clients are enough.

Why it creates value

Larger groups usually sell at a higher multiple of earnings than small standalone companies. That gap is called multiple arbitrage.

07 · Common pitfalls

Where buy-and-build strategies stall

Most mistakes do not happen during the purchase itself, but before and after it. Here they are shown at the point in the process where they occur.

Stages of a buy-and-build strategy

over the holding period

  1. Thesis

    market, gaps, target picture

  2. Platform

    first investment

    PITFALL 1

    Platform cannot carry it yet

  3. Finding add-ons

    outreach, conversations

    PITFALL 2

    Buying whatever is on offer

  4. Integration

    systems, team

    PITFALL 3

    Integration planned too late

  5. Group

    exit or further build-out

    PITFALL 4

    Owner and team not brought along

1 · Platform

If everything still depends on the owner, every add-on slows the platform down instead of strengthening it. The stress test shows this in advance.

2 · Finding add-ons

If you only look at auctions, you buy what is available and pay competitive prices. The valuation calculator shows what drives the price.

3 · Integration

IT, accounting and pricing cannot be aligned on the side. The plan for this belongs before the letter of intent.

4 · People

Clients are often tied to the owner. If the owner leaves too early, part of the value leaves too. The comparison of PE investors and strategic buyers shows what each means for owners.

08 · Sectors

Where buy-and-build works

Buy-and-build works where many small companies do the same thing and a group achieves more than each could alone. Each row links to the sector analysis.

Typical platform and typical add-ons

examples
REGION

new region, same service

The same service in a new area. Typical for maintenance, testing and waste management, where clients expect short distances.
SERVICE

new service, same clients

A new service for the same clients. The add-on brings technology or know-how the platform would otherwise have to build.
CLIENTS

new client segment

A new client segment for the same service, common in software. More in the sector analyses.

09 · Access

The right add-ons are rarely in an auction

Many owners think about succession years before they sell. If you approach them during that time, you are often the only one talking to them. Later, several bidders are at the table.

An owner's timeline to a sale

schematic

  1. First thoughts

    succession unresolved

  2. Open to conversations

    no sale process

    1 investor in talks

    Window for direct approach

  3. Adviser appointed

    teaser, buyer list

  4. Auction

    price set by competition

    many bidders

For the owner

They get to know a buyer without starting a sale process, and they decide whether it goes any further.

For the investor

They are the only party talking to a company that fits the gap profile exactly. That is the core of proprietary deal flow, with more on sourcing deals in DACH and building deal flow in Germany.

How I help

I find these companies through a longlist with market mapping and approach the owners in confidence through direct approach.

10 · FAQ and sources

Frequently asked questions about buy-and-build

If you are looking for a platform or need add-ons for an existing one, see add-on sourcing and the search mandate. More background is under what deal origination is and for investors.

What is the difference between buy-and-build and a roll-up?

In a buy-and-build, an investor buys a well-developed platform and adds suitable companies step by step, each with its own due diligence and financing. A roll-up combines a platform with smaller companies quickly to gain market share, usually with standardised due diligence. PwC draws this distinction in its March 2025 study of the DACH market.

How many add-ons does a buy-and-build group make on average?

In the DACH region, the average was 3.1 add-ons per PE-backed company between 2019 and 2024. In the Nordics it was 4.7. The figures come from PwC's March 2025 study, based on Gainpro data.

Why do add-ons increase the value of a group?

Larger companies usually trade at higher EBITDA multiples than small ones. If a platform buys smaller companies at lower multiples, their earnings are valued at the group's higher multiple when it is sold. This is called multiple arbitrage. Shared administration and purchasing add to it. How large the effect is depends on sector, integration and timing.

What size does a company need to be a platform?

There is no fixed revenue threshold. What counts is a second management tier, systems that can take on more sites, and enough size for add-ons to stay small beside it. What size is enough is set by the buyer's investment thesis.

What does buy-and-build mean for an owner who sells?

As an add-on, a company usually keeps its team, clients and name and hands tasks such as accounting or purchasing to the group. The owner often takes a stake in the group or stays in management for a transition period. As a platform, the company itself becomes the core that others are added to.

Where do investors find platforms and add-ons outside auctions?

Many suitable mid-sized companies are not for sale. They are found through direct approach, before any sale process begins. I describe how this works systematically under deal origination and on the pages about the search mandate and add-on sourcing.

Looking for a platform or an add-on?

Tell me about your thesis. In a confidential first call I will work out whether and how I can find a platform or add-ons for you.

Enquire about a mandate→