This article first appeared on VideoInk's site and is reprinted here with permission. You can find the original article here.

In 2014, Mark Zuckerberg tried on a prototype headset from a VR startup called Oculus VR. The experience was transformative and Zuckerberg saw the massive potential for VR/AR, including the impact on social media and gaming. When he realized that Facebook needed to be a part of VR/AR, he had two options: organically build a Facebook product that could take years to develop—ceding precious time and brand awareness to market leaders and future competitors like Oculus—or strategically invest in an existing company to accelerate their go-to-market timeline and signal Facebook's commitment to the future of the VR/AR industry.

Facebook made a big bet—a $2 billion bet—that VR/AR was going to be an important part of the social industry in the coming years and that Oculus was going to be the partner to help them dominate the market. Since the acquisition, Facebook's stock has grown by more than 50%.

The pace of today's digital transformation of the media and entertainment industry is far faster than anticipated by most. This transformation has been fueled by Millennials and their mobile-first, social preference for content consumption. New digital-first media companies can finance, produce, market, and distribute their content successfully without the once required studio system, so traditional media companies recognize that they must rapidly evolve and actively "play" in this disruptive new reality. Many now realize that M&A, investment, and strategic partnerships are the most efficient and effective ways to stay relevant and effectively positioned for the future.

While traditional media companies have the capital to change their course, they must shrewdly choose among these strategic options to accelerate and optimize their path. Deep strategic thinking to understand how best to structure a deal and savvy due diligence to optimize it post-transaction are needed.

This past year was a major year for M&A, investment, and strategic partnerships, and 2016 looks to be even bigger. Transactions such as NBCU's double investment into Vox Media and BuzzFeed show that future relevance is worth $400 million to these traditional players. But with so many new digital media companies operating, how can the traditional companies identify the right targets? Relevant factors include:

1) Faster go-to-market opportunities: When Facebook acquired Oculus for $2 billion, many people were shocked at the sticker price. But what they did not immediately understand was that Facebook was positioning itself to be one of the first to market in virtual reality (VR). While Facebook has great tech capabilities, starting a competing VR company from scratch would have cost more and taken years to accomplish. With the Oculus acquisition, they were immediately best in class and able to leverage our second trait . . .

2) Synergistic capabilities: Making bets on companies that can enhance or build your enterprise value is essential. Facebook's acquisitions of Instagram, Oculus, and Whatsapp have positioned it well to be a fully integrated ecosystem, capable of leveraging its reach across platforms and helping to increase its acquisition of active users. A future seamless offering from Facebook does not seem far off—something consumers and shareholders will appreciate.

3) Unique offerings for growth: Traditional media companies need new major growth opportunities, so piggybacking on the explosion of new digital businesses is an easy and smart way to achieve success. The growth opportunity for the seller needs to align with the buyer's goals, but identifying companies that fit can provide tremendous value in the long run.

4) Diversifying portfolios: We've already seen companies such as SoftBank and Tencent taking advantage of this opportunity with great success. Traditional media companies need to mitigate the risk new digital companies pose by getting involved in areas that aren't core to their current lines of business. Virtual and augmented reality, eSports, and live streaming are all areas that may not be current lines of business but can offer great value to traditional media companies.

5) Signifying a position to Wall Street or the broader marketplace:Strategic digital transactions are not only an operational and business benefit, but it may show investors and competitors that the traditional media company is serious about the future of its business. The last label any media company wants to be tagged with is stagnant, and the right transactions can provide a clear communication that they have a plan for the future.

In addition to target identification, comprehensive due diligence is required. However, this process can't be solely the financial and legal activities that typically take place. A focused and smart process to understand the value, potential and match of the target company is necessary. A true ROI projection and identification and mitigation of risks prior to any deal completion will help satisfy essential stakeholders throughout the transaction.

While everyone typically focuses on the deal itself, many times companies drop the ball post-acquisition. A clear post-transaction integration plan will save traditional media companies time, money, and employee morale (not to mention bad press). Enabling the target company to do what they do best, managing relationships and differing cultures, and keeping up the external communication are required to complete a truly successful deal.

We see tremendous opportunity here, especially from a global standpoint. Major transactions from major international companies such as ProSiebenSat.1, Alibaba, and SoftBank have shown that the industry is going to continue down this path at an accelerated rate. Those companies that continue to lead in this strategy will be well positioned to not only survive, but to thrive in the new digital world.