An impressive 72% of corporate development officers expect deal volumes to increase in 2021, signaling a recovery from the COVID-19 pandemic. Although it’s great to see lofty targets again, corporate development officers must consider the necessary effort and technologies that will help them get deals done and meet goals.
Unfortunately, as seen in the Lion Equity Partners Annual Corporate Development Report, some corporate development firms are forging forward without the necessary tools to effectively achieve these goals. The report — which measures attitudes, trends, and challenges surrounding corporate deal origination, acquisitions, and divestitures — surveyed 250 corporate M&A professionals in January and February 2021. The report discovered that corporate development firms are on track to eventually fall behind better-prepared industry peers unless they adopt modern technology. In fact, a striking 69% of firms either rely on outdated methods such entering data in Microsoft Excel spreadsheets (57%) or do not track their company’s deal sourcing and pipeline data at all (12%).
Other notable findings of the survey include:
- 93% of corporate respondents reviewed fewer than 200 deals in 2020, and 73% reviewed fewer than 50 deals
- Survey respondents identified seller valuation expectations as the number one roadblock to closing deals in the current environment
- 85% expect to pursue smaller, tuck-in acquisitions in 2021
- No respondents expect their corporate development team to downsize during 2021
- 91% of respondents plan to travel for business within the coming 12 months, including 11% who have already restarted business travel
- 80% view corporate development as a long-term career choice
Achieve Corporate Development Goals Wherever and Whenever
The work-from-home model continues to be a challenge: 16% of respondents said negotiating deals in a virtual environment has been a roadblock to closing deals. “The primary change has been getting comfortable completing diligence virtually,” added one respondent.
Corporate development experts also noted the importance of third-party data providers like PitchBook (used by 43% of respondents), S&P Capital IQ (39%), FactSet (3%), and SourceScrub (1%) — all of which are automatically available for users on the DealCloud platform.
Purpose-built technology like DealCloud can help firms overcome challenges of remote work. Our solution allows corporate development teams and leaders at acquisitive public and private companies to more effectively manage deal pipelines. The platform also acts as the central hub for M&A relationship intelligence. DealCloud was built by deal-makers to be configurable and responsive to the unique needs of corporations, and flexible enough to account for all of the complexities of M&A transactions.
DealCloud Technology Is Built for the Needs of the Corporate Development Officer and Allows You to Be More Easily Organize and Manage M&A Activity
As corporate development teams grow in 2021, it’s critical that new and existing employees have the right, purpose-built tools to play offense and score M&A deals.