Initial public offerings (IPOs) often engage in mergers and acquisitions (M&As) subsequent to going public which can reflect either exit or growth strategies. We analyze 2,679 entrepreneurial firms in Europe that went public between 1996 and 2010 and find a superior long-run performance of acquiring IPO firms. This finding is in sharp contrast to the results of Brau, Couch and Sutton (2011) for the US. The difference in long-run performance between IPOs that repeatedly acquire other firms and IPOs that are acquired is more than 60 percent after three years. These results become even more pronounced when we differentiate between the two IPO cycles. Moreover, we observe significantly positive announcement returns for IPO acquirers. Thus, the market expects that these acquisitions are successful and will create shareholder value. The main factors that influence whether IPOs become bidders or takeover targets are access to external financing, internal and external growth opportunities, firm size, and the institutional environment.