Deal origination is the process of sourcing deals on the buy-side (working with private equity firms to identify companies to invest in or acquire) and on the sell-side (working with companies who want to raise funds or even exit). It isn’t just a key component of successful investment banks, but is now a must for all businesses looking to grow. This article will examine the key dos and don’ts of a successful deal origination as well as a few useful strategies that companies in the new school are using to increase their efficiency.
Traditionally, businesses have relied heavily on inbound deal flow that they sourced from their relationships with intermediaries and business owners. This is not an effective method to increase the amount of and quality of deals. It can be time-consuming and difficult to set accurate goals and forecasts if the number of lead sources is not known.
Many investment banks are now making an effort to source outbound deals. This process involves searching for specific types of transactions within areas in which they have expertise and a strong network of contacts. It is now increasingly conducted via online platforms, such as Axial which serves as an integrated repository for deal information.
In addition the majority of investment banks utilize technology to automatize their search processes, making the process of http://www.digitaldataroom.org sourcing leads easier and more efficient. This enables them to focus on establishing and managing their connections with intermediaries, while also improving their ability to spot and qualify the right investment opportunities at the right moment.