Small M&A Boutiques Have Changed the Deal Market
Interesting article by Andrew Scola on LinkedIn Pulse on how small M&A firms are displacing “traditional” investment banks in middle-market mergers and acquisitions.
“The knowledge economy has transformed the consulting landscape, reducing the advantages of the traditional consultancies along with the barriers to entry. Although contractors and interims have been around for longer, the true disruption started around the turn of the millennium with the birth of a new kind of consulting model.”
Some of the key benefits/differentiators of the “small is good” model:
- Focus on M&A specialism and competence and the expertise that follows from this on an individual and organisational level
- Experience of the client-facing individuals, enabling smaller expert project teams (less juniors)
- Value of the services because of the efficiency and expertise, coupled with lower structural costs and typically more transparency on costs
- Choice of professionals within the network allowing clients to pick team skills and profiles with precise requirements tailored to their needs
- Flexibility and agility of a smaller (hungrier) firms makes working with them more suited to the client's needs than that of the consultancy
- Cultural fit can be found (less consultant-like?) and better attitude in terms of collaboration with client teams and third parties
- Transfer of knowledge in-house because consultants are embedded in client teams, not a separate suited clique
- No conflicts of interest or cross-selling (which clients hate)