PE’s New Virtual Reality: Online Deal Sourcing Platforms

Myra Thomas | October 1st, 2015 | http://www.middlemarketgrowth.org

This story appears in full in the October issue of Middle Market Growth.


Private equity is known as a high-touch, relationship-driven business. The biggest transactions are parceled out to a few choice players—the Goldman Sachs and KKRs of the world—with many deals struck after just a few calls to select deal participants. But middle-market deals require a bit more legwork, with many more private equity firms and investment advisers in the mix.

The bulk of middle-market deal flow is spread out over hundreds of intermediaries. Now a number of online private equity deal sourcing platforms are cropping up to make the process more efficient. Not unlike online relationship matchmakers such as Match.com, these sites provide buyers and sellers with online tools to connect to one another virtually.

Platforms run the gamut, offering everything from deal listings research and due diligence to networks of buyers, sellers and advisers. Fees differ depending on the customized service, and a few of the platforms allow free subscriptions for access to the network.

According to Tony Hill, director of Intralinks Dealnexus, a New York City-based global deal sourcing platform for M&A professionals, the middle market is the “sweet spot” for new entrants in the online space; they typically target deal-makers working with companies that have less than $100 million in revenue. “We’re talking about deals that appeal to a wide range of buyers,” Hill says. “But with the push of a button, we can supercharge the ability to narrow that buyer list.” …

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