Selling lead gen to PE firms
Hello everyone,
I run a lead gen agency and I'd like to help PE firms source deals on a pay-per-lead model.
I've been cold emailing PE firms and getting positive responses, but no one has scheduled a meeting yet.
My questions are:
1. What challenges do private equity firms face when sourcing off-market deals?
2. What should a lead gen agency offer to interest a private equity firm in its services?
Any advice would be greatly appreciated.
I honestly don't think PE is a great fit for this type of business, especially with a pay-per-lead model... if even 10% of those leads are actionable (due to investing guidelines, getting things past IC, availability and pricing of assets, etc) that is a waste of money compared to other opportunities for them to source. Maybe this will be super successful and I'm proven wrong, but I don't see it as compelling right now
1) You're competing against bankers who do this for free (regularly keep in touch with these firms that might sell, pitch them to PE firms, and only collect a fee when a deal closes)
2) Lots of PE firms who don't find deals through bankers have junior employees who do this - they already work for them and do modeling work if they source anything, so also "free"
3) Relationships are very important - excluding small rollup strategies like buying out every HVAC guy willing to sell, the senior guys are paid the big bucks for relationships built through decades in the industry. Deals of PE magnitude come from existing relationships, either with the seniors involved or at least the bankers
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