Let's talk about an uncomfortable truth in the background screening world: the company you signed with last year might not be the company you're working with tomorrow. And no, we're not talking about some mysterious corporate identity crisis—we're talking about the merger and acquisition frenzy that's reshaping the background check industry faster than you can say "due diligence."
While everyone's been busy watching tech companies gobble each other up, the background screening industry has been quietly conducting its own version of corporate Monopoly. The difference? These aren't billion-dollar app companies—these are the firms responsible for vetting your next hire. Stakes? Pretty high.
The numbers don't lie, and frankly, they're staggering. Over the past six years, we've witnessed some of the largest transactions in background screening history:
2018 - First Advantage was acquired by Symphony Technology Group for $1.3 billion
2019 - HireRight was acquired by Altegrity for $1.05 billion
2020 - Sterling Infosystems was acquired by Calera Capital for $700 million
2021 - Checkr was acquired by Vista Equity Partners for $5.1 billion
2022 - GoodHire was acquired by Hellman & Friedman for $7.1 billion
2024 - Sterling Check was acquired by First Advantage for $2.2 billion
Sure, the acquiring companies will tell you it's all about "synergies" and "enhanced customer value." But let's be honest about what's really happening here.
Scale Economics: Bigger means cheaper per unit. When you're processing millions of background checks, even small efficiency gains translate to massive profit increases. It's basic math, not magic.
Technology Consolidation: Rather than building their own platforms, it's often cheaper to buy someone else's tech stack. Why spend years developing a system when you can write a check and own it tomorrow?
Market Control: Let's call it what it is—fewer competitors means more pricing power. When five companies control 80% of the market, they have a lot more leverage in negotiations.
Private Equity Gold Rush: Financial firms have identified background screening as a recession-proof, high-margin business. When people need jobs, employers need screening. It's that simple.
But here's the kicker: while these deals might make financial sense for the companies involved, the impact on customers is often an afterthought. And that's where things get interesting.
Does all this mean that it’s bad to have your background screening partner acquired by a larger company? No, not necessarily. Depending on your company’s size and needs, it could serve you well. Regardless of your business objectives, all companies should monitor such developments closely. Here are some things to be mindful of in the event of a merger or acquisition:
Service Changes You Didn't Ask For
That custom screening package you spent months perfecting? It might not exist anymore. Acquiring companies often consolidate their service offerings, which is corporate speak for "we're eliminating anything that doesn't fit our standard template." Your carefully crafted screening program could become a casualty of "operational efficiency."
The Mysterious Fee Increase
Acquisitions cost money—lots of it. And guess who often ends up footing the bill? Hint: It's not the private equity firm that wrote the check. Fee increases are often justified as "enhanced service delivery," but enhanced for whom exactly?
Customer Service Roulette
Remember Sarah from customer service who knew your account inside and out? She might be working somewhere else now. Post-acquisition "workforce optimization" often means your dedicated service team gets reshuffled, reassigned, or shown the door. Suddenly, every call becomes a 20-minute explanation of your needs to someone who's never heard of your company.
Technology Integration Nightmares
In theory, combining two technology platforms should create some super-system with amazing capabilities. In practice, it often means months of "we're experiencing technical difficulties" while they figure out how to make System A talk to System B without exploding.
Data Security Concerns
When companies merge, data moves. Your historical screening records, candidate information, and compliance documentation could be transferred to new systems, new servers, and new security protocols. While regulated industries have protections, data breaches during transitions aren't unheard of.
Here's what acquiring companies don't want you to know: most post-acquisition "enhancements" are designed to increase revenue, not necessarily improve your experience. That new comprehensive package they're pushing? It might include services you don't need at prices you don't want to pay.
The reality is that many acquisitions are about efficiency and cost-cutting, not innovation. When private equity gets involved, the focus often shifts to maximizing returns, which doesn't always align with maximizing customer satisfaction.
The consolidation trend isn't going anywhere, so the question becomes: how do you protect your organization's interests while navigating this changing landscape?
Partner, Don't Just Vendor: Look for providers who want to understand your business, not just process your transactions. True partners will work with you through transitions and changes.
Value Substance Over Size: Don't assume bigger automatically means better. Focus on what matters: accuracy, speed, compliance, and service quality.
Plan for Change: Accept that your current provider might not be your long-term provider. Build flexibility into your screening program so you can adapt when necessary.
The background screening industry is in the middle of a massive transformation. Companies are being bought, sold, and merged at a pace we've never seen before. As a customer, you're along for the ride whether you like it or not.
The key is staying informed, staying flexible, and choosing partners who prioritize your success over their own growth metrics. Because in an industry where your hiring decisions depend on accurate, timely information, you can't afford to gamble with mediocrity.
At CIChecked, we've watched this consolidation wave from our position as an independent, licensed private investigative agency. We've seen what happens when profit margins become more important than client relationships. That's exactly why we've remained focused on what matters: delivering complete, current, and compliant results while maintaining the personal service that gets lost in corporate mega-mergers.
The choice is yours: roll the dice with the consolidation giants or partner with a firm that's committed to staying independent, staying personal, and staying focused on your success. Ready to work with a background screening partner who's not for sale? Contact CIChecked at (518) 271-7546 to discover what investigative excellence looks like when it's not answering to private equity shareholders.