Source Talks ep. 48

Source Talks is a series where we discuss deal origination with PE and M&A pros, in collaboration with David M. Toll.

In this episode, we speak with Jody Shechtman, Partner and Head of Marketing & Business Development at GreyLion, about the firm’s collaborative approach to sourcing transactions, how they use technology to increase their market coverage, and sales process trends she’s seeing in the market.

Jody, start off telling us about GreyLion and the kinds of transactions that you do there.

At GreyLion, the majority of what we do is backing founders and entrepreneurs who are at an inflection point in their growth trajectory. We focus on two sectors broadly. The first is services, which includes a variety of sub-sectors, tech-enabled services, software, healthcare services, consumer services. And then the second is industrial manufacturing, where we look for high-margin, high-growth, differentiated products and processes. I’ve always taken a collaborative approach to sourcing transactions. And that means that it’s not important to us who a deal comes in through. Rather, we focus our efforts on ensuring that each opportunity has the right resources dedicated to that specific opportunity. A bunch of years ago, we switched our CRM to DealCloud and in addition to customizing DealCloud to automate notifications, reminders, and helping with reporting, we rely on several other platforms to ensure that we’re covering the most relevant deal sources for our next potential deal. The most helpful of these platforms has been Sutton Place Strategies, where we work with Muhammad. SPS helps us to stay in front of, again, the most relevant folks, contact new deal sources who have opportunities that are middle of the fairway for our investment criteria.

Jody, tell us what trends are you seeing out there in how sales processes are being run by bankers today?

Over the last 18 months, we’ve definitely seen more targeted processes where bankers are going out to a handful of groups with relevant sector expertise. They’re trying to gauge their potential interest in an opportunity. And sometimes that even means that they’ll offer a casual introduction or a fireside chat with a management team before they formally launch a process. Nobody wants to launch a broad process and then have that fail. So being able to keep it to a narrow group means you can say, this was a very narrow process and we felt like we contacted the most likely buyers and therefore have the most conviction and certainty to close. We are revisiting those founders and management teams who came to market at some point in 2021 or 2022 and ultimately didn’t transact. A lot of what we do is control, but we also do a lot of minority investing and we’re very flexible in that approach with the right deal dynamics. There’s definitely benefit to us mining that network and again, making sure that we’re in front of them, that we provide a lot of advice and guidance and we’re a thought partner to them.

Jody, tell us a little bit about how you spend your time outside of work.

I’m a very serious skier. I spent several years out west, college and after college, skiing in the backcountry and also in terrain parks. I guess my hidden talent is that I can pretty much ski anything, anywhere, and with anyone.

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