Here’s How to Make M&A Deals Online

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Aug. 27 (Bloomberg) -- IntraLinks CEO Ronald Hovsepian discusses the company’s online deal making product on “Market Makers.” (Source: Bloomberg)

We have the ceo of intralinks.

Ron, online dating for companies.

Tell us how it works.

It sounds pretty exciting.

The way it works, it is a simple process.

It is a global online platform for matching the buyers and sellers through their advisors.

It makes the entire process much more efficient in the way we connect up all of those parties because we have built a qualified community to bring everyone together.

Why advisors?

If i'm hiring an advisor, it is because the advisor knows other advisors in the business?

They know what is for sale?

It is like hiring a real estate agent.

The real estate agent notably knows what is on the market and saves me from having to find myself.

I would you want advisors and not ceos or chairman of the board?

It doesn't really change the process.

What it does is be that the process.

The key is, when you have worked hard to build your business the way you want to build your business, you're going to go to our key m&a advisor and you said advisor because they have a big rolodex of people they can reach out to.

What we are doing is help speeding the process along by connecting different groups of buyers and sellers, as well as the heads of corporate development offices.

We bring them all together through this process by allowing them to connect and filter who sees which deals on a secure basis with complete confidentiality into a community of people that are m&a professionals.

That speeds up the process.

What is your average size deal, ron?

They range from early-stage companies all the way through to very large companies, and hundreds of millions of dollars in deal size.

I think what is very exciting what we're seeing and the deals and the way their building at this point is our inventory that has built up inside of our platform has are ready grown to over $100 billion of deals now inside of there amongst the professionals to share.

What about the buyers?

Are they looking for specific type of deal, certain industry, certain market cap?


Great question.

The way the platform is constructed, where the largest global platform in the world for this type of relationship connection.

What it does is allow the end user who is selling the company or by to set a set of filters to choose which size companies i want, and how those companies could fit from ebitda or revenue perspective.

You run those filters.

A great example of that would one of our customers who has used the platform is a benchmark international out of tampa.

What benchmark did was help sell a company.

One of the things they wanted to do was bring a competitive tension into the game.

When they did that, they set their filter, set up what they wanted to show, got outreach from over 150 advisors within minutes they had matches to 150 different players.

The connection made a relationship broke ventures who ended up being the buyer of the asset.

According to brooke ventures, they improved the productivity by 30% because they did not have to sift through as much.

You can see how the buyer and seller come together.

With a more expeditious process.

Ron, how does it make money?

Great question.

What is really important to us is the advisor, as a highlighted.

We charge annual subscription fee to those members.

It is an exclusive community that we want to maintain.

We don't want to have any transaction fees.

That is really critical to our model.

It is really a subscription model as we deliver the service.

How do you get people to come back?

Part of the issue with online dating service, once they hook up, they don't need your site anymore.

How do you do it?

We're glad to see the marriages happen and they don't come back.

That is on the transaction, the deal itself.

But there are matchmakers in the world.

If you think of us as a matchmaker, there is always a role for the matchmaker.

We're helping the advisor -- the m&a advisor, make more matches.

That is what they do.

They are the matchmaker.

We're getting this tool to enable them to do that.

What we've seen, we are literally seen the count of deals double in the last year.

We are really seeing an uptick in the number of deals falling into the platform that is helping the m&a professional perform better.

That is making more matches happen.

Lacks the way you describe it, you're speeding up the m&a process and making it easier, faster him a cheaper in some cases for advisors to do this work, possibly putting some investment banking analyst out of a job in the process.

If all of that is happening, the logical conclusion should be -- because you're saving time and effort -- him in a few -- m&a deal fees go down.

Our job is just to make the much happen.

No, no, i really is not for you.

But that is what technology is supposed to do, right?

Make or productive and ultimately reduce the cost of a high touch business.

So if this is happening, if companies like yours are successful in making that job easier, the m&a advisors should be cutting their fees.

Yeah, i think it will make for a more productive environment and the m&a advisors should build a charge appropriately.

As you know, that part of the market and midmarket and down has been growing the number of advisers and the number of deals down in that part of the market.

This will make for more efficient process.

Your point, it may make for more competitive process.

Thank you for being here this morning.

Coming up, rahm emanuel bets big on big data.

This text has been automatically generated. It may not be 100% accurate.


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