How to increase your M&A deal flow?

As a CEO, one of your main priorities is to generate growth for which you have an interest in accessing new technologies and/or expanding internationally, particularly through mergers and acquisitions. In order to do this, you need a robust and continuous pipeline of proprietary deal flow. Here are four practical tips to help you increase the quantity and quality of your company’s deal flow.

1. Reach Out to Your Personal and Professional Networks

Your personal and professional networks are sources of rich deal flow. If you’re not already doing so, make it a point to regularly reach out to your network members (e.g., via email, social media, or phone) and update them on what’s happening with your company. In addition, let them know that you’re always on the lookout for M&A opportunities and would appreciate any leads they may have. You’d be surprised how many people are happy to help if they know what you’re looking for!

2. Get Active on Social Media platforms 

Social media platforms such as LinkedIn and Twitter can be excellent sources of deal flow if used correctly. Start by following industry thought leaders, commentators, and journalists in order to stay up-to-date on the latest news and developments in your industry. Then, when you see an interesting article or post that could be relevant to your business, share it with your network with a comment or brief analysis of your own. Not only will this help position you as a credible authority in your field, but it will also give you an opportunity to reach out to potential acquirers who might be interested in what you have to say. 

3. Attend Relevant Industry Events 

Another great way to generate deal flow is by attending relevant industry events . Not only will this give you an opportunity to meet potential acquirers face-to-face, but it will also allow you to stay up-to-date on the latest industry trends. This knowledge will come in handy when you’re evaluating potential acquisition targets. When choosing which events to attend , be sure to consider the size, prominence, and focus of the event. Smaller, more intimate gatherings will usually result in more productive conversations than large trade shows or conferences . 

4. Hire a Dedicated Business Development Executive 

If your company is serious about generating proprietary deal flow, then you should consider hiring a dedicated business development executive whose sole responsibility is identifying and pursuing acquisition opportunities . The best business development executives are typically very well connected individuals with extensive experience in their industries . They also tend towards being ambitious self-starters who are comfortable taking initiative and working independently . If you don’t have the budget to hire a full-time business development executive , then consider hiring a consultant or firm on a retainer basis. 

5. Use your digital investment bank

Lastly, the most efficient way to source M&A opportunities is to leverage AI to map all relevant targets. Collaboration Capital algorithms allow you to discover all the target companies worldwide matching your criteria. Then, by contacting the validated targets, you connect with the managers interested in selling their business.
Depending on activities and sizes, between 10 to 40% of managers are interested in selling their business. Moreover, by contacting them directly, you access off-market opportunities: the targets have not yet initiated the research of acquirers, and you are the first to have the information. 

In conclusion, a clean deal flow is essential for all CEOs who want to grow externally to generate value through M&A. By following these five practical tips, you can ensure that your company has a continuous pipeline of high-quality acquisition and divestiture opportunities.