Field Note · Capital, boards, and transactions
M&A Banker, Corporate Development, or Neither?
Hiring an intermediary creates motion. It does not create a transaction thesis, readiness, or a reason the right counterparty should care.
A thinking frame by Andrew Moss
The questions I get
Usually some version of these:
- When should we hire an M&A banker?
- Should we build corporate development internally?
- Can we approach a small number of buyers or targets ourselves?
What a lot of people seem to think
The common assumption is that hiring a banker is the first serious step toward a sale or acquisition program.
How I look at it
Start with the transaction thesis, readiness, repeatability, confidentiality, and the capability the company wants to retain. Then decide whether an external process, internal ownership, or a quiet targeted approach fits the work.
Why the decision matters
The cost is rarely confined to the line item.
If the sequence is wrong
A premature process can leak information, distract leadership, create fee obligations, weaken leverage, and teach the market the wrong story.
If the sequence is right
The route matches the thesis, the company is prepared, incentives are understood, and the right counterparties receive a credible process.
How reversible is it?
Low once a process is launched, information circulates, and counterparties form a view.
The short answer
Do not hire motion before the company has a thesis.
Write what the company wants to buy, sell, learn, or achieve; why now; what would make a transaction attractive; and what must remain confidential. A banker is useful when market reach and process execution matter. Corporate development fits when the work is recurring and strategic context must compound internally.
Incentives belong in the architectureA fee is not just a price. It can change the process.
Before signing an engagement, understand what triggers a fee, what happens if no transaction closes, how tail provisions work, who the banker represents, and where incentives could reward motion that the company does not actually want.
Move fromHire an intermediary→Move towardDesign the transaction route
The order I would use
Take the right steps in the right order.
- 01
Write the thesis.
Define the strategic objective, target or buyer logic, valuation range, alternatives, and walk-away conditions.
- 02
Assess readiness.
Test financials, diligence materials, management bandwidth, legal issues, messaging, and the ability to answer hard questions.
- 03
Choose the process shape.
Compare a broad auction, a narrow targeted process, ongoing internal corporate development, and waiting.
- 04
Diligence the intermediary.
Test the actual team, relevant relationships, judgment, confidentiality, references, fee triggers, conflicts, and state or federal requirements.
- 05
Retain learning.
Decide what market intelligence, relationships, integration capability, and decision history should remain inside the company.
Questions worth answering
Before the next irreversible move:
- Is this a one-time transaction or a recurring capability?
- Does market breadth improve the outcome or create leakage?
- What result triggers compensation?
- Who will own preparation and internal decisions?
- What happens if the company chooses not to transact?
What not to do
Do not confuse a process with readiness.
Do not sign an engagement before understanding fee and tail mechanics. Do not assume every banker is exempt from every registration requirement. Do not outsource the transaction thesis or the company’s final judgment.
Keep the perspective
The right intermediary should improve the decision, not merely increase activity.
A good process creates information, leverage, and disciplined choices. A bad one can make management feel committed before the company has decided what it actually wants.
The boundary
What still depends on the facts
M&A, broker registration, fee arrangements, securities, tax, and transaction duties are fact-specific. Qualified legal, tax, and financial professionals should review the actual engagement and transaction.
Independent sources
Useful primary material
These sources support the public frame. They do not replace the private facts or the accountable professional.
Common follow-up questions
When is corporate development worth building?
When acquisitions, divestitures, partnerships, or strategic investments are recurring enough that market knowledge and internal process should compound.
Can a company run a targeted process without a banker?
Sometimes. The answer depends on internal capability, conflicts, confidentiality, market reach, regulation, and the complexity of negotiation and execution.