AI took your Sales job? Become a software M&A originator!

Disclaimer: Unless noted otherwise, views and analysis expressed here are the author's own and based on public sources. The article is intended for informational and entertainment purposes only. This is not financial advice. Please consult a professional for investment decisions.

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“No such thing as a no-sale call. Either you make a sale, or they sell you on a reason they can't buy now!”

This is a quote from Boiler Room - an early 2000s movie about peripatetic brokers pushing stock to retail investors. The movie is a chock-a-block of trash talk and fast cars. Yes, Vin Diesel plays a part: before the Fast & Furious era.

You know what else is in the movie? Tips on how to sell anything. 

The software aggregator market has become so frothy, deal originators are being traded like footballers.

No wonder.

The largest and most successful aggregators, such as Constellation, Banyan and Valsoft each close dozens of deals. Every. Single. Year. Their secret sauce? Dedicated originators. This sales-like role requires a unique skill set to identify, engage, and close deals. 

We asked several high-performing software originators a simple question: what’s your setup? Their answers inspired this article, in which we discuss:

• What kind of people succeed in M&A origination?

• How to run an effective origination team

• Origination KPIs at different senior levels

• Compensation and career path for originators

And yes, we used more quotes from Boiler Room to reinforce the message. Enjoy! 

Before we begin: have you got your ticket to our next Software Serial Acquirers Summit in London, on 6 May? Register here!

“We’re not brokers, we’re salesmen”. What kind of people succeed in M&A origination?

What are the essential qualities for an origination professional? We have identified five:

• Inner drive: crucial for staying the course through 2+ year sales cycles and 99% rejection rates

• Sales experience coupled with a grasp of software fundamentals.  As Rachel Clemo from Tenzing, a mid-market software PE investor, put it, “Deal origination is enterprise sales. In order to succeed, you have to really understand your ICP. As an acquirer, how are you different from the competition?”. Technical founders who can sell, perform really well

• Consistency and rigour. "Some people don't get a response and simply skip the lead", noted one originator. 

• Being genuinely curious about the business you’re trying to buy - not just chasing quarterly KPIs. Examples of this include: tailored outreach emails (specific to the target’s industry) and having trialled the product before the first call

• Don't be a d*ck to sell-side advisors. For SMB owners everywhere, price isn't the only decisive factor. Patronising their broker is a sure-fire way to get pigeonholed as a corporate asshole…  

Next, let’s talk about experience levels and backgrounds. Here, opinions vary A LOT. One aggregator told us that "you don't need a senior person to speak to business owners" - better to have someone hungry for success. Whereas another firm believes that “maturity is a key element of credibility”, for things like negotiating the NDA and handling questions like “how much do you typically pay?”.   

As for the backgrounds, we have seen a fair few successful originators coming from:

• Software sales / BDRs

• FP&A folks with sales aptitude

• Non-sales people from smaller aggregators

• Recruiters

Further reading: Crack the Deal Origination Code: 4 tips to help you close more deals, faster - our webinar with Timm Overmans (Chapters Group / Everfield / Constellation Software) and SourceScrub. 

“Don’t hang up until you get a yes - or a restraining order”. How to run an effective origination team

In this section, we talk about:

1. Commonly tracked origination KPIs: what does good look like?

2. CRM and process management

3. Effective outreach strategies 

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