Investment bank analysts and private equity professionals need to effectively analyze large databases of companies to generate quality deal flow. AI tools can quickly identify potential targets for investment banking deals and increase research efficiency. AI-powered deal sourcing platforms will automate manual processes and provide quick access to valuable data that can help guide acquisition decisions.

What is deal sourcing?

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Deal sourcing, or deal origination, is a strategic approach to identify prospective investment opportunities used by investment banks, private equity and venture capital firms. It involves market research to find and evaluate opportunities that are in line with their investment criteria.

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Benefits of AI-Powered Deal Sourcing Platforms

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AI-powered deal sourcing platforms provide valuable insights for buy-side and sell-side bankers. These software solution use sophisticated algorithms to analyze large datasets and help generate deal flow opportunities. AI deal sourcing tools can quickly identify companies that are most likely to be a good fit as potential targets or buyers and then enable analysts to evaluate those leads more efficiently.

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What AI-powered deal sourcing tools can do:

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  1. Eliminate manual company research: They reduce the time analysts spend on collecting information about the markets and potential acquisition targets. 
  2. Find hidden gems: AI-powered deal sourcing tools can quickly identify deals that meet the buy-side investor's criteria through keywords, filters and example companies. They are not restricted by the information in traditional registries. This means that these tools can find hidden value opportunities all over global markets and in specific niches.
  3. Provide a comprehensive list of acquisition targets: Deal sourcing platforms combine a list of potential companies, ready for further analysis. The results include key metrics such as company size, ownership structure, geographical focus and operational location. ‍
  4. Data coverage: AI-powered deal sourcing platforms enable an increase in the scope and depth of deal sourcing, with more markets and geographical areas covered. They improve the depth of data by scraping all corners of the web to identify key features of potential acquisition targets.

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Top AI tools for deal sourcing significantly reduce desktop research hours and allow professionals to allocate more time on other parts of the M&A process. Especially if an analyst has an example company in mind, AI based deal origination enables locating similar companies within all markets.

Furthermore, AI powered deal sourcing platforms are able to uncover companies with strong financials, preferable funding stage, or ownership structure. Additionally, these tools help streamline the due diligence process by providing timely data and insights into potential investments.

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Top AI Deal Sourcing Tools

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Want to find an overview of leading deal sourcing platforms and a comparison of features? See a list of deal sourcing platforms and compare their features and pricing.

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Case Study: Inven's AI-Powered Platform

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Inven revolutionizes deal sourcing by reducing the time M&A professionals need to invest in manual desktop research and Googling. Inven uses AI to analyze millions of websites, registry data, and social media, and combines all data points under one roof. This makes it easy for M&A professionals to search for companies and source deals within any specific niche.

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With Inven, you gain access to company owner contact information and financial data significantly more efficiently. Inven provides verified company contact data on 430M+ professionals and financial information from over 43M+ legal entities, including data such as revenue, EBIT, and balance sheet data.

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Key Features and Capabilities of Inven:

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  • Smart AI Deal Sourcing: Analysts no longer need to manually scout multiple sources, as Inven provides information in one place. This ensures especially the access to lower middle market deals that might be missed otherwise.
  • Search based on Company Ownership information: Input search parameters and filters to tailor search criteria precisely. Find family-owned companies or PE-backed enterprises, for example.‍
  • Companies that are Likely to Sell: Inven finds potential investments that are not actively being traded. With a specific feature, Inven locates companies that are likely to face a generational handover in the future, or that have been in a PE portfolio over a certain period of time. ‍
  • Company Recommendations based on your Example Company: By harnessing the latest NLP technologies, Inven has the capability to identify companies that share similarities. This ensures that Inven finds companies that engage in similar activities or offer comparable products and services, making deal sourcing from niche industries a lot easier.
  • First analysis by AI Screener: Inven's built-in AI Screener does the initial analysis of the long list based on your description.‍
  • Access to Contact Data: Make outreach a lot easier by having key contact information available right away. Inven provides analysts with the potential targets’ owners, their phone number and email.

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The benefits of AI in investment banking deal sourcing are clear. AI helps uncover valuable investment opportunities and build a list of prospective deals more effectively.

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Want to know more?

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