The Secret to More M&A Deal Flow

Posted On: 12-13-2017

If you’re working to acquire a business you’ve probably learned that, in today’s M&A market, money is the easy part.  Finding the right opportunity is the hardest part.  I’ve got a solution.  Change your approach.  The definition of insanity is doing the same things over and over again and expecting a different result.  Stop the insanity!

With the over abundance of buyers and capital flooding the M&A marketplace an indirect acquisition approach bears little result.  Meaning, networking with professionals in the deal community and expecting for-sale opportunities to come to you is largely just a time-wasting exercise.  It takes a lot of luck for a deal to come to fruition this way, luck is scarce right now for buyers in what is largely a seller’s market.

Here’s the solution.  Define what you want.  Create the profile of the perfect acquisition opportunity.  No, you won’t know it when you see it.  Nor, will you be missing opportunities because your search is too fine.  If you can’t define your target, you’re not a buyer, you’re a looker.  There’s a difference.  Think about it this way.  You have a finite amount of capital to invest in an acquisition.  Are you going to throw that capital at the first opportunity that comes across your desk?  Probably not.  Why?  Due to the fear that there is something better out there.  You need at least one more similar opportunity to compare it to.  Without it, it’s nearly impossible to make a buying decision as there is no relevancy. 

Take matters into your own hands.  Define what you want and hire help to get it.  A buy-side M&A intermediary can start your search with as little information as the name of a company that you define as a “perfect fit”.  Similar companies can be researched that fit that same profile and a direct outreach program can begin.  A true buy-side search does not wait for opportunities, it creates them.  Most business owners that are considering an exit have not taken active steps to facilitate an exit.  They simply ponder the idea, discuss it with their spouse, and go back to running their business. 

I readily acknowledge that these are difficult conversations to have with business owners whose companies are not technically “for sale”, hence the value of a professional M&A intermediary.  This is what we do every day at River’s Edge Alliance Group.  We have a defined, methodical process of reaching out to companies that fit buy-side client criteria to facilitate acquisition discussions.  Once our clients review a few opportunities within the same space they either move to acquire the target, or pivot their search based on the information that we’ve gathered for them.

Whether you’re a small private equity firm, a corporate acquirer, a small business acquirer or an individual acquirer, River’s Edge Alliance Group can assist you in generating active deal flow.  The initial investment is nominal as the majority of our fee is success based.  If you’re a serious buyer, don’t leave your acquisition to fate, take control of your process.

For more information, please contact Scott Mashuda, River’s Edge Alliance Group, LLC at 440-915-3082 or by e-mail at smashuda@RiversEdgeAlliance.com.

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