Deal origination investment banking is an essential procedure that lets private venture capital and equity firms identify, connect, and finally close deals for their businesses. This process, also referred to as deal sourcing, is critical in order for these companies to maintain a full pipeline of deals, and can be accomplished using either traditional or online approaches.
The most well-known methods for finding investment opportunities is to network with industry experts and entrepreneurs, who are able to give access to confidential information regarding a business owner’s plans to sell their business in the near future. Additionally, it is important for investment firms to be aware of changes in the market so they can anticipate what their competitors are doing in the market.
Many modern investment banks utilize technology solutions to accelerate the deal sourcing process, including advanced data analytics, specifically-designed digital tools, and artificial intelligence. This allows teams to better know their market, improve processes and turn data into a competitive advantage for their company. Private company intelligence platforms and data services are essential to this, as they enable professionals to research and identify potential investment opportunities using verified, relevant business information.
Some investment banks have their own internal deal sourcing team comprised of finance professionals, whereas others have outsourced this job to specialist contractors. In both cases, the team members work on a fee-for service basis that means they get paid an amount of money each time they close the deal on behalf their firm.
