August 26, 2021
In a live webcast hosted by The Deal in partnership with Williams Lea, investment banking leaders and dealmakers discussed the good, the bad and the ugly of dealmaking during the pandemic. Were virtual transactions more efficient? What virtual elements of dealmaking will continue in a post-pandemic world?
The panelists: Patrick Suehnholz, Managing Director at Greenhill & Co; Adi Blum, Managing Director at Blackrock; Edward Manheimer, Managing Director at Morgan Stanley; and Ed Rasmussen, Managing Director at Williams Lea, answered these questions and more.
View the webcast recording on-demand [below]. You can also download the post-event recap.
Here are the key points made during the discussion:
Relationships are still a key factor in dealmaking
In a survey conducted by The Deal in partnership with Williams Lea, 58% of respondents reported that the inability to build personal relationships and connections had the most negative impact on contract or deal terms. The panelists agreed, saying that there was no substitute for face-to-face interaction. One panelist pointed out, “While the velocity of coverage has increased, the lack of travel created efficiency gains, so we can have more meetings, there is a hard-to-quantify, hard-to-define personal element of relationship building that is harder to port to the virtual environment.” To overcome this challenge, dealmakers relied on existing, long-standing relationships to drive new business.
Pitches will likely revert to in-person; other dealmaking processes may remain virtual
While virtual dealmaking was more efficient (41% of survey respondents found it more efficient in terms of time and effort spent, while 39% found it about the same), there will be certain aspects of dealmaking that will return to the old ways. Pitches, especially for new business, will “snap back really hard (to in-person),” said one panelist, though the bar for business travel will be much higher. What may remain virtual will be “the guts of the deal” processes, such as diligence meetings that can still be done over Zoom.
Dealmakers see a trend toward more interactive, multimedia pitches and presentations
The survey revealed that dealmakers and deal advisers found interactive pitches and presentations more effective, with 68% of respondents saying they planned to continue using multimedia and video-based elements in the future. “Even when we’ve gone to physical meetings, the clients didn’t want physical books, so it [the presentation] had to be on the screen. Whether that was COVID-19- or environment-related… we don’t want paper,” said one panelist. “I do think that’s probably a trend you’re going to see; the fact that it is digital, it enables you to do other things… and more and more meetings will have the opportunity for that.”
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