Historically, the deal sourcing process — particularly direct outbound deal sourcing — has been a time-consuming, resource-intensive effort. AI is changing that.
While the tech can't replace years of experience investing in a space or in-person conversations with executives, it can streamline your sourcing workflows so that you can find the right deals faster.
AI-powered platforms can analyze millions of businesses and help dealmakers identify potential targets that traditional databases might miss.
Below, we break down how AI technology can make your sourcing workflows more efficient and effective.
Mapping Industry Opportunities with AI
See How Your Space is Fragmented
AI is built to recognize patterns at a speed humans cannot replicate. No amount of know-how or self-improvement will give a dealmaker the ability to read millions of webpages in seconds, so the top dealmakers are leaning into what AI can teach them about a space, even a space they've been in for years.
AI can help dealmakers see the distribution of millions of companies in seconds. How many companies in a given market are based in the US? How many are bootstrapped? How many have raised funding?
AI-powered dealmaking platforms like Grata enable dealmakers to see the full picture of their target market in a single snapshot. Here’s an example from Grata's recent PE Playbook: Software Development Tools report.
Identify Other Investors in Your Space
Private market dealmakers also need to know which financial sponsors and strategic corporates are investing in their target market. AI can pull a list of investors based on keywords in seconds.
Grata’s powerful AI allows dealmakers to see M&A activity from sponsors and strategics in any space. Dealmakers can track how many transactions have occurred in the market over time and see which investors are the most active.
Finding Acquisition Targets with AI
Discover Companies Similar to Your Successful Port Cos.
Looking to find deals similar to your last successful exit?
AI-powered deal sourcing platforms like Grata allow dealmakers to type in the name of a company and generate a list of similar companies with one click.
Advanced NLP algorithms can synthesize investment-related data from highly unstructured websites. ML-based tuning continuously improves the system to achieve investment-grade data.
With similar company search, you can filter on a company’s industry, business model, size, growth, location, funding, ownership, executives, and competitors in the same list.
Quickly Understand a Company's Core Focus
AI trained on the business internet can understand a company's core focus at scale.
Grata's investment-aware language model is purpose-built for M&A workflows, and it produces accurate, comprehensive company descriptions. Each description includes the company’s:
- Product or service offerings
- Target customers
- Key differentiators
These descriptions lead to the most precise search results, helping investors find the right deals faster.
Case Study: How Grata’s AI Supercharged Edgemont’s Deal Sourcing Workflows
Edgemont, a boutique healthcare M&A firm, has been on the frontline of healthcare-focused business transactions for over two decades. With a dedicated team of 50 full-time bankers, the company assists healthcare companies through critical transitions such as mergers and acquisitions.
As Head of Business Development, Ben Hughes needed to reach out to numerous companies every day. Initially, Hughes’ outreach efforts relied on Amazon Mechanical Turk and manual workflows for digging up contact information online and assembling spreadsheets.
Hughes quickly realized that these efforts weren’t scalable. This led Edgemont on a quest for a more streamlined solution that could cater specifically to its unique business model within the healthcare sector, where niche companies are abundant but often hard to pinpoint due to their smaller digital footprints.
Grata's user-friendly interface, powered by its AI search capabilities, made it an obvious choice for Edgemont. Grata’s investment-grade data and proprietary AI provided Hughes and his team with the specificity required in the healthcare sector, where many companies maintain a low online presence.
Grata’s integration with Edgemont’s CRM system also played a crucial role in the team’s success, streamlining processes further and enabling a more efficient workflow.
The impact on Edgemont's business development activities was undeniable. Grata’s platform enabled a significant increase in the number of calls and meetings, laying the groundwork for future business opportunities.
As Edgemont continues to leverage Grata's capabilities, the firm remains at the forefront of technology adoption within the investment banking sector. The platform’s focus on AI and automation not only positions Edgemont for sustained success but also heralds a new era of efficiency in business development activities within the healthcare M&A landscape.
Want to see how Grata’s AI can help you find better deals, faster? Schedule a demo here.
