Broker strategy?

February 25, 2021

by a searcher from University of Virginia-Darden - Darden School of Business in Salt Lake City, UT, USA

Hi all, just wondering how you are working with brokers. I have heard that you need to build a close relationship so that you can get deals before they hit the websites.

My interactions with brokers so far have been transactional. Basically, I've asked them for info on some companies, the companies were garbage, and at that point I'm disinterested and they probably feel like they've wasted time.

What's your relationship-building strategy?

Reply by a searcher
from University of Virginia in Toronto, ON, Canada

We try to get an intro whenever possible (asking other searchers, operators, potential lenders we chat with to make an intro or if we can mention their names). We also try to find a balance between asking about enough deals (we don't have a focused industry) but not asking about too many deals at the same time. When rejecting a deal, we use specific reasons and language in the CIM to show we've taken time to read and thought about the deal seriously.

Reply by a searcher
from Concordia University in Dubai - United Arab Emirates

They get thousands of emails of tire kickers so my strategy is to find some decent ones in the area I am targeting and set up a meeting with them. Be prepared by knowing your target industry, target SDE and type of growth stage (start-up, developing, mature, retiring owner etc.). Have financials ready to show them you are serious and then go from there. That should start some deal flow your way.

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