Corporate development deal teams are struggling to manage their pipelines, especially as the volume and complexity of deals increases. In fact, Accenture’s 2021 Digitizing M&A report reveals that 85% of strategic acquiring executives aren’t confident in their current operating model’s ability to meet their ever-evolving priorities.
Corporate development teams can no longer rely on traditional processes to meet the growing demands of the industry. Instead, dealmakers need innovative technologies to digitize and automate strategic acquisition deals so they can move more deals through the pipeline more quickly and efficiently.
Centralizing and democratizing shared knowledge
In the past, corporate development managers and executives would spend exorbitant amounts of time gathering data from disparate sources on their teams’ various bids; they’d then schedule board meetings to discuss and vote on whether to approve or reject those bids.
Often, however, by the time the board meetings took place, both the bids and the data they were based on were out of date. Additionally, without the proper management technology in place, firms risked losing or recording inaccurate information about the meetings themselves. For example, a key reason why an executive voted against a deal might have been left out of a meeting’s summary report.
To better manage bid-related data and improve the approval process, some firms have attempted to replace their traditional, in-person approval meetings with tools like spreadsheets, PDFs, and email. Unfortunately, these tools come with their own set of data management pitfalls, as they require even more time and energy to create, maintain, and secure.
To truly increase efficiency, corporate development deal teams need to digitize their approval process and leverage technologies that automatically capture data generated by their collective activities — thereby providing teamwide transparency and helping them make better-informed decisions.
Today, the most productive corporate development deal teams are adopting DealCloud, a purpose-built information management system that eliminates the need to manually record activity and deal data. Instead of taking on the daily administrative chore of inputting relationship-building and deal-tracking information, your teams can use DealCloud to automatically capture data as it’s produced.
DealCloud streamlines the internal approval process and provides corporate development deal teams with numerous benefits:
- Faster, easier, and more productive research — Be prepared for your next board meeting by making sure you have critical information at your fingertips. For example, you can use DealCloud to identify comparable deals in terms of size, growth stage, industry, or management, or determine how a given board member voted on a deal, why, and what the target’s response was.
- Up-to-date data — DealCloud populates your reports with real-time data, so you can have confidence that you’re presenting the latest figures.
- Smarter, easier data capture — As dealmakers weigh in with approvals, contingencies, or rejections, DealCloud collects and organizes all of it for future recall.
- A single, centralized system — All of your deal teams can use DealCloud, eliminating your team members’ need to toggle between legacy note-taking apps, email archives, disparate file-sharing programs, virtual data rooms, and unsecured spreadsheets.
- Better collaboration during board meetings — Instead of spending valuable meeting time sharing data, you can dedicate the time to brainstorming, problem-solving, expanding on your vision, and forming leadership decisions.
The most efficient corporate development teams use purpose-built technology to help them keep track of where deals stand and who needs to do what. DealCloud can eliminate the administrative burden of securing internal approvals to help accelerate your corporate development team’s deal velocity throughout the various stages of an M&A transaction.
Automate the work of vetting and acquisition opportunities
No matter how strong and clear your investment thesis and strategy are, you’ll still need to get internal approval from initiative sponsors in these preliminary stages. DealCloud helps you collect and organize information into easy-to-read formats so everyone can get on the same page before discussing a deal.
For example, you might need to solicit the following answers from members of your deal team:
- Which business unit (if any) do you see this acquisition benefiting?
- Which platform head do you feel is best qualified to sponsor this deal?
- Should we advance?
- What potential integration challenges do you foresee?
- What deals have you worked on that resemble this one, and in which ways are they similar or different?
- What would we do with the new asset(s)?
- What alternatives to acquiring do you recommend (if any)?
- Should we build or invest rather than acquire?
- Which of your network contacts may serve this transaction best, and why?
Deal teams without DealCloud often vet new deals by reviewing and deliberating such questions during lengthy meetings. Depending on the deal, team, and acquiring corporation’s strategy, each question can take anywhere between a few minutes to several hours to discuss.
DealCloud, on the other hand, lets team members create and send forms to deal sponsors, then automatically collects and compiles their answers in real time on the deal page. All members with access can check the deal page at any time to review inputs other users have provided. With this workflow automation, deal teams can work asynchronously and spend their time more effectively in meetings, instead of gathering and reviewing information in time-consuming meetings.
Automate deal diligence and documentation
DealCloud also helps streamline the later phases of a successful M&A initiative: relationship-leveraging and the technical stages of acquisition.
DealCloud’s event-triggered notifications alert dealmakers when they need to review or complete a task. One M&A manager, for example, created an alert for his counsel to begin legal due diligence the moment financial due diligence was completed and assessed.
Managers can set time-based notifications, as well. An M&A manager using DealCloud recently configured his firm’s instance to notify deal team members responsible for phone call follow-ups 4 days after initial approach letters were mailed to target heads.
DealCloud users can also automate due diligence and documentation via custom dashboard creation. You can configure the platform to reveal various data sets and how they relate at any given time, shining a light on all the important details you need to speed up internal approvals.
For example, one corporate development deal team in Texas worked with its DealCloud account manager to create a real-time dashboard that includes:
- An overview of all initiatives sorted by business unit and strategy — The team leverages a clickable chart that shows deals by business unit — such as digital and integration and production system — on one axis, and acquisition strategy — such as core-strengthening, go-to-market, and growth — on the other.
- An overview of strategic initiatives — The team utilizes a second clickable chart that shows deals by type — such as partnerships, acquisitions, and internal builds — on one axis, and strategy — such as core-strengthening, go-to-market, and growth — on the other.
- A list view of sortable, detailed initiatives and their respective specifics — The team uses an organized table to view deal differentiators such as stage, status, target geography, business unit, potential value, vendors involved, and contact names.
Creating a full and fast pipeline
It’s not enough to have a full pipeline — you also need a strong internal approval process to move your deals through the pipeline quickly and smoothly. Our research shows that the most fruitful and strategic corporate development teams are ones that combine good sourcing with deal velocity.