For companies focused on growth and scalability, the traditional model of pursuing innovation through research and development (R&D) just isn’t working. Markets are simply moving too quickly, especially when it comes to developing and deploying AI-based tools and systems.
Case in point: It can take months to develop the initial concept for a new healthcare product, as noted by Pacific Research Laboratories. And afterward, months of designing, beta testing, and planning will be necessary before the product ever reaches the market.
Although this innovation timeline makes logical sense, it can leave a company behind. Truth be told, if an innovation takes more than a year to launch, it may already be outdated by the time it’s available to the public.
Faced with this reality, many corporations are taking a “Why invent when we can invest?” route to innovating. Rather than building products and software from scratch, they’re making deals with companies that have already done the legwork. Basically, they’re buying innovation. As a result, merger and acquisition (M&A) activity is increasing across many industries.
Survival of the Fastest through M&A
To be sure, taking M&A shortcuts to bypass conventional R&D processes isn’t a new concept. Take the merger of Disney and Pixar, for instance. Bringing the two entities together 20 years ago allowed both brands to share technologies and improve their strength in a highly competitive and lucrative market.
However, the M&A activity happening now isn’t just occurring between enterprise-level companies like Disney and Pixar. As April 2026 United States M&A reporting from EY Parthenon shows, it's happening among mid-market businesses as well. For executives evaluating acquisitions, one increasingly important question is what AI tools can help identify specific areas for value creation and new growth before a deal is completed. Collectively, those deals are contributing to forecasts that place global M&A activity above $3.8 trillion in 2026.
Are all those M&A transactions fueled by a desire to fast-forward toward innovation? Maybe not. But “instant innovation” is certainly on the minds of many corporate leaders, particularly in the areas of innovation related to AI.
Getting to Market First Without Cutting Corners
It’s not hard to understand why companies interested in producing AI innovations are taking the M&A route. The pace of AI evolution has made years-long internal R&D cycles obsolete. Just think about the recent history of ChatGPT: It was introduced worldwide at the end of 2022 and quickly moved the goalpost in terms of how quickly the AI industry was expected to move. (Interestingly, the prototypes for ChatGPT had been in the R&D stages for several years before OpenAI’s big public release.)
After ChatGPT’s shake-up, its competitors had little choice but to accelerate their R&D and bring competitive generative AI products to market right away. ChatGPT basically reset the pace for the AI race, and the race has continued.
However, it’s worth mentioning that not all AI innovations are worth going through an M&A for companies. Only the most promising AI tools and technologies will create value and new growth for organizations. Currently, these include agentic AI solutions, industry-focused AI tools, and robotic AI prototypes.
For example, agentic AI systems are appearing everywhere. Why? This type of AI product is capable of independent decision-making. When AI “agents” are tasked with solving problems, they use logical reasoning to come up with answers. Rather than just fetching information, they can search on their own for insights and then reason their way to possible answers. Plus, many agentic AI systems use a variety of agents that can communicate with each other, much like interconnected teams of specialists working together.
Obviously, agentic AI systems are complex to build, which means R&D could take years. By snapping up AI-nimble firms that have already poured time and energy into their R&D, a mid-market or enterprise-level company looking to offer agentic AI options to its clients can make inroads sooner.
Plug-and-play Innovation as a Futuristic, Lasting Trend
This movement toward skipping the lab and going straight to the finish line doesn’t mean that companies will no longer invest in having their own R&D teams. On the contrary, internal R&D is still thriving at many organizations.
That said, being able to buy innovation instead of building it can be enormously beneficial to both parties. After all, bigger companies can’t afford to wait to wow their customers with new products. And smaller tech startups that have put sweat equity into R&D but lack the heft of a larger corporation can enjoy a faster runway to get their innovations to market.
