Today’s technology has made it a lot easier for M&A professionals. Information about buyers and sellers is readily available online, which allows buyers to find and act on deals all across the country and from under the radar sources which weren’t available before. If one is heavily relying on technology to assist in the deal, it can slow the process down and increase the amount of time it takes to do a deal. Even when today’s technology can shorten the time period to perform the due diligence process, it can be difficult to develop a relationship and an understanding of the parties involved between buyer and seller when much of the communication is done by email.
Example: When there are endless updated requests for Trailing Twelve Month revenue updates and the use of virtual data rooms and using them without ever meeting the other side in person, makes it difficult to interpret the right context and cultural insight on both sides.
“That means you end up talking to the other side and using that conversation to really try to understand the other side’s industry and their place in it. Decisions are data driven and not enough time is spent on the focus of the relationship side on the negotiations.” Misunderstandings abound when extensive email communications are the mode of exchanging information to the other side. One can’t help but think that the process would be faster and more straight forward if more in-person meetings were integrated into the process.
Today’s younger folks seem less likely to value the face to face interaction and some choose not to meet anyone at all. There are times the face to face meetings are not necessary, but we have to remember that many deals require collaboration and partnerships and you need to get to know and be secure with your partner(s).
Before Google, one had to do a lot more thinking and spend more time communicating with the management team.