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Developing dealmakers: How to turn your M&A analysts into industry leaders with L&D initiatives

The number-one driver of workplace culture is the opportunity to learn and grow, according to a recent LinkedIn survey. Although many dealmakers apply learning and development (L&D) initiatives to their portfolio companies (portcos), few fail to add value to their own firms by upskilling their in-house talent.

Acquisition advisors who identify and nurture their internal M&A analysts can produce industry-shaping dealmakers. To turn M&A analysts into headline makers, though, firms must know what kind of dealmakers they want to be known for, share their knowledge internally, and execute a winning development program.

Use organizational insights to kickstart L&D

Before looking for external L&D resources, tap the wealth of wisdom and experience that already exists within your firm. Start by polling your team leads to determine the skills gaps presently plaguing their departments.

Ask your team leads questions like:

  • What skills do outperforming team members have that sets them apart from others?
  • What’s hindering learning within the team, and why aren’t team members improving on their own?
  • Which learning mediums and formats would be most effective?
  • What nuances affect the group’s current workload and schedule?

Once you have a better understanding of what’s challenging your professionals, enlist seasoned dealmakers to assist in addressing those issues. Encourage your dealmakers to lend their experiences and stories to augment formal lessons.

Technology can also help your team overcome L&D obstacles. DealCloud is an information management platform that automatically collects, parses, and stores the data surrounding your dealmakers’ transactions and relationships. By using DealCloud to capture context from the daily activities of partners and principals, up-and-comers can tap that knowledge and use it to build their own expertise.

Firms need to be able to provide the right people with crucial and relevant information, when and where they need it. This capability — known as institutional knowledge sharing — benefits all levels of employees: Junior dealmakers can access the information they need to succeed in their work, while higher-level leaders can acquire visibility into every aspect of the firm’s operations.

A director for KPMG’s M&A practice revealed that his firm’s analysts and associates leveraged DealCloud to access key knowledge shares from the firm’s partners and principals. “When you don’t have a system linking everyone together, you’re relying on everybody talking to everyone else at the right time about the right thing,” he said. “With DealCloud, we can access all of that on demand.”

He also pointed out that junior dealmakers no longer need to seek out colleagues for critical information — and senior dealmakers can now leverage firmwide insights to navigate the evolving markets. “It’s all in DealCloud,” he said. “It’s there, it’s at your fingertips, and it’s proving incredibly useful. It’s improving our ability to differentiate ourselves in different ways.”

When senior dealmakers help their associates and analysts cultivate new skills and characteristics, they share responsibility for learning and development. This ownership increases camaraderie and evolves your group into a more connected firm — one ripe for individual and professional growth.

Set L&D goals for dealmakers

No L&D initiative will succeed if its leaders don’t first define success. To do that, you’ll need to set a course by making the following decisions.

Diagnose past nonstarters to sidestep pitfalls

Examine professionals who previously failed to thrive at your firm. Did their individual growth slow down? Did those slowdowns eventually turn into stagnation?

Additionally, you can determine which skills a lagging M&A analyst may have appeared to have, but in reality lacked. What could the hiring manager have done to detect the deficiency before it became a problem? What could that M&A analyst have learned to excel in the role?

Document these observations so that, moving forward, you can successfully identify and prevent analysts from becoming stragglers.

Decide how your firm wants to differentiate

A firm’s reputation comes down to the characteristics and behaviors of its professionals. Determine how you want your group to be viewed within 5 to 10 years, and ask the following questions:

  • Do you want to be known as the most tireless, tenacious business development (BD) team? If so, you’ll need to develop more networking experts to ensure your deal pipeline will thrive.
  • Do you want to provide the best investor experience? Turning junior associates into customer service specialists will help you achieve a higher repeat investor rate than your rivals.
  • Do you want to provide the smoothest transactions? Cultivate M&A deal experts, and intermediaries, brokers, and consultants will soon compete for your business.
Add specific milestones to reach your end goal

Incorporate specific steps and milestones in your plan to turn your vision into reality. Start by determining key roles that will contribute to the firmwide goal you set. For example, if your ultimate goal is to provide the most accurate preliminary valuations in the industry, you’ll first need to create a team of high-powered associates and analysts who will do the necessary work.

Next, list the characteristics of professionals who excel in these key roles, and focus on measurability when filling the roles. Building upon the previous example, you could aim to help 50% of your M&A analyst team — many of whom are likely ex-investment banking analysts —become CFA charter holders within 3 years.

You should also revisit your team lead survey to identify the ways or reasons people have previously stagnated in these key roles. Determine what led to failure, and what success in this role should look like. Include target numbers, percentages, and time frames when defining success.

Finally, check your goals to make sure they’re achievable and realistic. Some leaders find that, when determining job requirements, they need to eliminate “nice-to-have” skills and instead focus on more essential skills that will serve the differentiation they’re going for.

Execute your L&D initiatives by turning untapped talent into dealmaking power

Now that you’ve determined your end goal, you can begin moving towards your various targets.

Narrow down your route options, and adopt and schedule a variety of training environments within your framework. You can choose resources like video lessons, guest consultant speaker series, mentoring, textual (book) learnings with quizzes, transaction shadowing, and/or a yearly industry symposium. By having a variety of L&D resources, you can accommodate various individual learning styles.

Consider upping the ante with your program by challenging your up-and-comers to demonstrate their learnings. For example, you can host live skill shares with mandatory teaching — not just attendance — for junior dealmakers. This requirement will push junior staff to engage more deeply with program teachings, rather than just passively consuming them. They can then share production hacks, automation ideas, time-saving shortcuts, valuation solutions, or relational tricks to nurture professional friendships.

Lastly, ensure the lessons are well-structured. Research shows that most people prefer guided learning — where learners receive a controlled release of training content and assignments along with clear milestones — over self-paced learning, where the material is available all at once.

As your team develops, compare the results against your original goals, and gather feedback from team leads. Did you address the needs they voiced in their pre-L&D survey? Once you’re at this point, make sure to maintain the momentum. Advertise your success as an employer where leading dealmakers are made — not just found — and more hungry, qualified candidates will start applying to undertake your L&D initiative.

Save your firm time and resources by providing L&D resources for M&A analysts

In the high-stakes world of private capital restructuring, it’s important for firms to prioritize L&D for their M&A analysts. Nearly 80% of L&D professionals say that it’s less costly to reskill a current employee than to find a replacement. Furthermore, CNBC reports that 94% of employees would stay longer with their current companies if their employers simply helped them learn more.

In addition to saving your group time and money, L&D initiatives aid in succession planning, which, in turn, supports repeat investor commitments. “Limited partners (LPs), some of whom have long-standing relations with one fund manager, are deeply invested in who takes over, so they often actively monitor succession plans,” writes Andrew Woodman in a recent PitchBook post. “Given the lifespan of the average [private equity] fund, some LPs may be unlikely to re-invest in a future fund if they think a proper succession plan is not in place.”

Looking for a platform that allows your firm to better store institutional knowledge and prioritize development in your dealmakers? Schedule a demo of DealCloud today.

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