3 steps for better collaboration within capital market deal teams

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Several studies conducted over the last decade suggest that 50% of all finalized M&A deals fail to achieve their initial objectives — including the most fundamental objective, which is to help participating organizations generate tangible returns on their investments.

 

Although deals can fail for many reasons — from misaligned objectives to skewed execution — most failures stem from a lack of communication between transacting parties. Parties often fail to clearly define desired deal outcomes, leading to a slow, unsatisfactory execution of the process.

 

It can be particularly hard to effectively execute internal communications and due diligence in larger firms due to the size of the teams and the expanse of the work. Teams rarely have visibility into what their colleagues are working on elsewhere in their firms, or how those efforts might affect their deals. As a result of this lack of clarity, team members often needlessly duplicate work and step on one another’s toes.

 

Such was the experience of Richard Lee, Director at KPMG, and his team members — until DealCloud’s revolutionary data analysis and client-facing pipeline management capabilities helped the KPMG team collaborate more efficiently and streamline their operations.

 

Step 1: Use data to seek more viable deals

A successful M&A deal relies on several factors, including viable cost synergy. Unfortunately, participating companies sometimes realize too late that there’s a stark difference in their inherent values and actionable objectives — and the deal falls through.

 

To successfully select viable candidates for deals, capital market deal teams need to follow a thorough diligence process. Lee and his team use DealCloud’s state-of-the-art CRM capabilities to help automate workflows within their due diligence process, allowing them to select the best possible candidates.

 

DealCloud also provides Lee’s team with real-time access to important companywide data, including the number and quality of ongoing deals, success rates, the average time needed to close deals, and other data collected by advisors and members of KPMG’s vast network. By making all of this information available on a single, easy-to-use platform, Lee and the deal team can better understand their pipeline.

 

“As a client-facing executive, I spend a lot of time looking at the pipeline in DealCloud,” said Lee. “I can determine what opportunities I’m pursuing, … what I need to do, and what I should be doing.”

 

Lee explained that DealCloud is especially helpful in terms of proactive outreach, as the software prompts users to contact clients when it’s time to follow up. These notifications help ensure that relationships don’t turn stale — and clients don’t get overwhelmed with too many communications.

 

Step 2: Enable open communication within the organization

Capital market deal teams in large firms like KPMG are often unable to leverage their expertise because of weak intra-organizational communication. For example, KPMG’s London team oversaw finance-based mergers, and had valuable information and insights to share with other regional teams handling similar clients. However, due to the vast expanse of the firm, the regional teams felt disconnected from both one another and the London-based team, and struggled to access this key data.

 

Open inter- and intra-organizational communication is key to executing a smooth M&A deal, which is why DealCloud lets teams create and store customized deal flows for future reference. These teams can also closely monitor the deals that other regional teams are currently handling to avoid overlapping work and conflicts of interest.

 

Lee and his team advise capital markets teams to update their companywide CRMs each time they reach out to a viable client. This simple yet effective process helps teams reduce work redundancy and avoid spamming leads with too many requests. Lee says DealCloud has helped his team work more efficiently by letting the team record and leverage client information across multiple different transactions — greatly reducing the time spent searching and entering data and content.

 

Step 3: Use automation for instant client-facing analysis

Capital market deal teams can gain client trust by delivering actionable industry insights that clearly illustrate the team’s process. If, for example, a financial technology platform is targeted for a merger with a large investment bank, the deal team can pull up data about similar successful mergers that earned that platform an excellent ROI.

 

DealCloud’s client-facing analysis lets executives generate important deal insights, such as cost synergy analysis, within minutes — helping them inform their clients about the factual merits of the proposition and its ROI, and building trust and confidence. For Lee and his team, being able to leverage these insights during meetings is extremely valuable.

 

“People are able to bring up insights and intelligence on their mobile phone in a way that they’ve never been able to before,” Lee said.

 

Streamline your M&A deal flows with DealCloud

DealCloud is a comprehensive financial services software that helps capital market teams streamline their workflows from start to finish. Client-facing executives can use the platform to search for and investigate viable opportunities, while deal teams can contact those potential clients, set up meetings, and register feedback and objectives in the software.

 

DealCloud further helps teams set and manage deal pipelines for a quicker, more efficient deal flow. With state-of-the-art features like third-party data integrations and fully customizable deal flows, capital market teams can use DealCloud to leverage extensive industry insights to their advantage.

 

Schedule a free demo to learn how DealCloud can streamline your M&A deal flows.

 

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Author:

Katlyn Kohler

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