Investment banking, also known as Deal Origination, is the primary source of revenue for the majority of investment firms. As such, a firm’s success depends on their ability to keep a steady flow of good investment opportunities.

In the past, an organization’s acquisition and investment process started by members establishing relationships with individuals and companies within their local markets through personal connections, using Rolodexes at golf games, lunch meetings, or simply attending industry events to meet business owners who might be interested in selling. Today, a company’s successful M&A process starts much earlier and has a greater global reach, thanks to advancements in technology such as data analytics, data analytics, and specially-designed digital tools.

M&A firm managers and their teams’ primary job is to spot companies that are likely to be attractive to sell on the marketplace and present them to business owners. If the business owner decides to take up the offer and then the investment banker gets a mandate to advise on the deal and earn a commission if they are successful in closing it.

Investment banks can handle a deal sourcing operation internally or outsource this task to intermediaries that are experts in a particular market or industry. The intermediaries can scan for opportunities, connect with business owners and move forward with www.digitaldataroom.org/what-is-operating-synergy/ the deal by handling paperwork and providing details about the market. Investment banks are not able to search through and filter through the numerous opportunities and are forced to rely on intermediaries, who may not have accurate and up to date business information.