Investing
Comparison
Buy-and-build vs traditional acquisition: which model suits health technology?
The health technology market is growing by 310% towards 2033. But how do you, as an investor, build scale most sustainably? A comparison of two fundamentally different strategic models.
By Niels Roest
9 min read
Strategic choice
What is the difference between buy-and-build and a traditional acquisition?
Buy-and-build is an investment strategy in which an investor acquires multiple complementary companies and connects them into an ecosystem. Each company retains its own brand, culture, client relationships and product vision. Value is created through collaboration, cross-selling and shared infrastructure.
A traditional acquisition (roll-up or consolidation) acquires companies and merges them into a single organisation. Brands disappear, teams are integrated and products are merged into one platform. Value is created through economies of scale, cost reduction and market dominance.
Both strategies chart a path towards growth. However, in health technology, where specialisation, trust and continuity are crucial, one model delivers structurally better results than the other.
310%
Market growth 2026-2033
Source: PCD market analysis
60-70%
Mergers miss synergy target
Source: McKinsey & HBR
25
Companies in CareHub
Source: PCD ecosystem strategy
Comparison: buy-and-build ecosystem vs traditional acquisition
| Criterion | Buy-and-build ecosystem | Traditional acquisition |
|---|---|---|
| Autonomy | Own brand, team and roadmap retained | Full integration into parent company |
| Specialisation | Domain expertise is preserved | Risk of loss through generalisation |
| Technology | Open standards (FHIR, HL7, REST) | Closed platform, vendor lock-in |
| Value creation | Ecosystem synergies and network effects | Cost reduction and economies of scale |
| Client relationships | Existing relationships retained, trust intact | Risk of client loss through forced migration |
| Talent retention | Entrepreneurs and specialists remain engaged | Key figures leave after earn-out |
| Integration risk | Low, phased connection | High, complex system migrations |
| Regulation (Wegiz) | Compliant through open standards | Adjustments needed to closed platform |
Why does the traditional approach work less well in health technology?
The traditional roll-up has proven its value in sectors such as telecoms and retail. But health technology has unique characteristics that make consolidation problematic.
1. Domain specialisation is crucial
An EHR for mental healthcare differs fundamentally from a planning system for home care. With consolidation, this specialisation is lost. The result: a generic platform that is not the best solution for any target group. Healthcare organisations are increasingly choosing best-of-breed.
2. Trust is not transferable
Healthcare organisations build relationships with their software suppliers over many years. A forced brand change after an acquisition undermines that trust. Research shows that 30-40% of clients switch to an alternative within 3 years of a consolidation.
3. Platform migration disrupts care delivery
In a roll-up, clients are forced to migrate to a single central platform. In healthcare, where systems are deeply interwoven with daily workflows, this leads to months of disruption. Healthcare institutions that have just invested in an implementation are not keen on a mandatory switch.
4. Regulation pushes towards openness
The Wegiz and the IZA mandate interoperability via open standards. Closed mono-platforms resulting from consolidation are at odds with this legal direction. Ecosystems built on open standards are compliant by nature.
The PCD approach
PCD's ecosystem strategy: buy-and-build with a mission
PCD CareHub combines buy-and-build with an ecosystem vision. The CareHub ecosystem connects 25 complementary health technology companies via open standards. Each company retains its identity, but benefits from shared infrastructure, compliance and market access.
01
Autonomy with connection
Acquired companies retain their brand, culture, client relationships and product vision. A mental health specialist remains a mental health specialist. But via standardised APIs and open standards (FHIR, HL7), all companies are connected.
02
Complementary selection
PCD deliberately selects companies that complement each other: an EHR supplier, a teleconsultation platform, a scheduling solution and a patient portal strengthen each other's value proposition. Together they offer healthcare organisations an integrated proposition that no single company could deliver alone.
03
Shared services
Compliance (NEN 7510, GDPR), legal affairs, information security and quality management are shared across the ecosystem. This lowers costs and raises compliance levels for all participants.
Ecosystem > consolidation
Stronger together, without losing identity.
Who suits which model?
Buy-and-build ecosystem suits:
- Investors who prefer long-term value over quick exits
- Markets where specialisation and trust are essential
- Sectors with strong regulation (healthcare, fintech, education)
- Fragmented markets with complementary niches
Traditional acquisition suits:
- Markets where products are interchangeable
- Sectors where economies of scale are the primary value driver
- Situations where rapid cost reduction is needed
- Companies with overlapping rather than complementary products
Frequently asked questions
What is the difference between buy-and-build and a roll-up?
A roll-up consolidates acquisitions into a single company with one brand and one platform. Buy-and-build in ecosystem form retains the individual companies and connects them via shared infrastructure and open standards. The difference lies in the degree of integration and the preservation of autonomy.
What return can an investor expect from an ecosystem strategy?
PCD's investment strategy targets an IRR of >20%. Network effects ensure that the value of the ecosystem grows non-linearly: each new company increases the value of all existing participants through cross-selling and a shared client base.
How does buy-and-build prevent acquired companies from losing quality?
By preserving autonomy. Founders and specialists retain their role, their product and their client relationships. They do not need to integrate into an unfamiliar system. Instead, they gain access to shared services (compliance, governance, HR) and a broader ecosystem that strengthens their market position.
Is buy-and-build specifically suited to the healthcare sector?
The healthcare sector is ideally suited for buy-and-build. The market is highly fragmented (hundreds of small health-tech companies), specialisation is essential (mental health, home care, hospital care), regulation requires open standards (Wegiz), and trust is not transferable (client relationships are personal). All of these factors argue for an ecosystem approach over consolidation.
Invest in the CareHub ecosystem?
Discover how PCD CareHub combines buy-and-build with open standards to build the digital backbone for Dutch healthcare.