You have a multi-million dollar company and need to expand. So, what options do you have to consider? This is a tough question for any business owner or CEO to consider when taking the next step in expansion. You know what you can do, but how do you do it?

The biggest consideration here is usually whether or not to acquire another company or merge with one. The considerations as to which option to pursue are considerable and should be carefully thought out before anything goes forward. First, you need to consider just how much of an expansion you’re looking at making. If you believe that you can expand on your own, then acquisitions and mergers don’t even need to be considered, and you can look at other forms of funding, such as making your business public. If, however, this isn’t an option, or you have already done this, then one does need to consider other companies.This is especially true when it comes to your competition. It was P.T. Barnum who is rumoured to have once said: “If you can’t beat ‘em, join ‘em.” This old idiom is especially relevant to this particular question, in that it is believed that Barnum said this upon recognizing that he couldn’t beat his chief rival, James Anthony Bailey, who had his own successful circus. His solution? He convinced Bailey that they’d be unstoppable together, and so they were. The Barnum and Bailey Circus is one that went down in the history books. This is particularly relevant if you’re asking yourself if you want to merge or acquire another company.

A merger is the best option if you find yourself in good, old Barnum’s shoes. If the competitor you’re looking at for a merger is one that can’t be defeated, but can be a powerful ally in expanding your business, then this is an option that is very appealing. For both companies, it involves an expansion of profits and the opportunity for a larger, and common, consumer base. With combined funds, resources are pooled, allowing for deeper market penetration, and the possibility of greater consumer loyalty after an adjustment period, of course.

The acquisition question is usually more straightforward than the idea of a merger. What is first on your mind should be: Can we afford to acquire another company. This is one that can be answered with a quick “yes”, if investors see your own business valuation along with what they can expect for a return after the acquisition has gone through. The biggest drawback is that an acquisition can actually weaken a company, although this is usually not the case. Investors can, however, be somewhat reluctant to fund an acquisition if a return on their funding falls into question. The solution to this, of course, is to have the documentation to assure them that this won’t happen.

In the end, any funding you expect is dependant on which decision is the best one for you and your company.