M&A Advisory Is Two Businesses. The Pitch Only Shows You One.
The skills that win the mandate aren't the same skills that sell your business well
A business owner I’ve been speaking to recently described a meeting he’d had with a pair of international advisors. He used three words: swish, smart, and slick.
They knew his industry inside out. They could name every deal in the sector. They had a track record they wore like a badge. He came out of the meeting half-convinced he’d already found his advisor.
What he didn’t realise — and what most business owners don’t realise — is that M&A advisory is actually two businesses, not one. And the skills required to be brilliant at the first tell you almost nothing about whether they’ll be any good at the second.
The two businesses
The first business is winning the mandate. The second is executing the deal.
They look related from the outside. They are not.
Winning the mandate is a marketing business. It’s about how you tell your story, how confidently you walk into the room, how impressive your case studies look on a slide, and how readily you can name names in the sector. Firms invest heavily in this. They have to. Mandates are how the business survives.
Executing the deal is a different animal. It’s about whether you can find the buyer that no one else has found. Whether you can run a process that creates real competitive tension instead of polite interest. Whether you can hold the deal together through the boring middle when everything starts to drag. Whether you can read what’s happening across eight live conversations and know which buyer to nudge and which to leave alone.
There is no necessary connection between the two. None. Some of the slickest mandate-winners in the world are mediocre at the second job. Some of the firms doing the most disciplined execution work have unremarkable pitch decks. The signal you walk away from a pitch with is almost entirely about business number one. And business number one is the wrong one to evaluate.
Two of the things you weight most heavily are actually negatives
Here’s where it gets uncomfortable. Two of the things business owners weight most heavily in a pitch — industry knowledge and deal volume — are, in my experience, mostly negatives.
Industry knowledge. A specialist who lives and breathes your sector knows every buyer in it. That sounds good. In practice, what it usually means is a network of cosy relationships with those buyers, and a valuation that’s been quietly anchored to whatever those buyers said in a phone call before your process even started. They won’t push hard because they need those relationships next quarter. They won’t find the left-field buyer who isn’t on anyone’s list, because their mental model of who buys your kind of business is already locked in.
We sold a software business last year to a buyer no specialist would ever have approached. They weren’t on any sector advisor’s directory. They weren’t in the obvious competitive set. They paid significantly more than the next-best offer — not because we got lucky, but because we went looking for the buyer no one else was looking for, and we ran a process that made them compete for the right to win.
A specialist who knew the sector inside out wouldn’t have considered them. That’s the real cost of industry knowledge.
Deal volume. A firm that does a high volume of deals in your sector has a structural problem you should think hard about. Who are their long-term customers? Not the sellers. Sellers are one-time clients. The repeat customers are the buyers — the trade acquirers and private equity firms who come back deal after deal. Where do you think the firm’s loyalty actually sits?
This isn’t a hypothetical conflict. It’s a structural one. A high-volume specialist needs the buyers to keep liking them. The seller, by definition, is a one-deal relationship. Do the maths on whose interests get protected when the process gets tense.
What real depth looks like — and why you can’t see it from a pitch
So what should you be looking at instead? Let me give you a concrete example.
For a software business we sold last year, we can show you the data behind the process. Over 100 potential buyers identified, researched, and approached worldwide. Every single one of them with a note next to their name explaining why they’re in or out — the conversation we had, the reason they said no, the reason they came in with an offer, the reason they were excluded.
That’s not a sales pitch. That’s an operational artefact.
And it took serious work to build. A research team that knows how to find buyers others miss. An outreach capability that gets actual answers, not voicemails. A tracking discipline that catches the buyer whose strategic priorities suddenly shift three months into the process and quietly become a fit.
You will not see this in a pitch deck. It doesn’t fit on a slide. The advisor who is going to do this kind of work on your behalf is unlikely to spend their pitch talking about it, because it’s unglamorous and hard to summarise. The advisor who is not going to do it will instead fill the pitch with industry war stories and named deals.
This is the asymmetry. The work that produces premium outcomes is invisible from the outside. The work that wins mandates is highly visible. Don’t confuse the two.
What happens when you confuse the slick presentation for the real work
A few years ago, we took a tech business to market. It was owned by a JSE-listed corporate that wanted out of that asset. We ran our process and generated eight offers, the top end around the R800 million mark.
For internal reasons, the corporate decided to hand the closing stages of the deal over to one of the best-known international M&A advisory firms in the world. A name you would absolutely recognise. The kind of firm with the slickest credentials, the most impressive case studies, and the most confident pitch in the business.
They went in arrogant. They tried to force the buyers into binding offers on a compressed timeline. They burned through the competitive tension we’d carefully built over months. The buyers pulled back. The numbers came down.
The deal eventually closed at roughly half of what we had on the table.
Half. Hundreds of millions of rands of value evaporated in the hands of a firm whose pitch deck is, by some measures, the best in the world.
That isn’t a knock on their marketing department. Their marketing is excellent. It’s why they got the work. It’s why they keep getting work. It just has nothing to do with whether they can sell your business well.
How to actually evaluate an advisor
So when you’re sitting across the table from a slick advisor who knows your sector, has done loads of deals, and is wearing a tie that costs more than your last family holiday — pause.
Ask yourself which of the two businesses you’re actually evaluating. The one in front of you, the marketing business, looks brilliant. That’s its job. The one that actually matters — the execution business — is harder to see from a pitch room.
The questions that surface the second business are different. How do you find a buyer no one in my sector would think of? Show me the buyer list from your last deal — every name, with the notes. Walk me through the deal where you had eight offers and tell me what you did between the first round and the final one.
If the answers to those questions are vague, you’re looking at a marketing business. If the answers are specific and a little boring, you may have found the execution business.
The difference is worth half your sale price.
Until next time,
Rick Grantham, Deal Leaders International