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Why you need to keep your deal teams small for mergers & acquisitions

It goes without saying that when entering into mergers and acquisitions (M&A), protecting yourself and your company should be the highest priority.

However, like with many other business matters, too much of a good thing can wind up being bad, as is the case with M&A deal teams.

Although the professionals that make up such a team are vital to making smart business decisions and covering a business, inviting too many people to be on the team can cause significant problems.  

Why are M&A Deal Teams Important? 

Many M&A plans fail because organizations haven’t carefully planned their next steps. They might have an excellent grasp of the big picture but lack an integration plan with the logistics to iron out and implement the details of the M&A. A mergers and acquisitions deal team helps draft and manage a process while paying attention to every aspect of the deal, such as its financial and management concerns. Without an M&A team in place, essential factors will more than likely fall to the wayside, setting the deal up for disaster. Most deals fall apart in the negotiation phase and plenty of these fallouts can be prevented with a team of professionals.  

Deal teams help ensure that every aspect of the M&A is studied and evaluated from a business standpoint. Considering this, it would make sense that some companies employ M&A deal teams that are 40 to 50 people deep. However, such a large number is often excessive and unnecessary, and in fact, it can also be a detriment to the company and the deal as a whole.  

Why You Should Keep Your M&A Team Small 


A lot of confidential information is exposed and shared during M&A. This information should only be revealed on a need-to-know basis. Otherwise, it leaves all involved parties open to excess risk. The more members on the M&A team, the greater the risk is. Leaked information can hurt not only the deal at hand, but the companies involved. 

Flexibility and Scheduling 

Frequently, M&A deals need quick action. They can’t wait around for days, let alone weeks, while dozens of people sync their schedules to be able to meet to talk about the deal. With a smaller M&A team, there’s more flexibility and ease of scheduling, which means not missing out on critical deals. The ability to meet, and meet quickly, significantly increases with fewer deal team members. In turn, the organization has a better chance at achieving the deals they desire. 

Decreased Confusion and Increased Focus 

When you have too many cooks in the kitchen, so to speak, the process and the end goal can become confusing. The more people on an M&A team, the narrower each individual’s focus can become. Focusing on how one-part fits into the whole can become difficult, if not nearly impossible. With a smaller group, each person generally knows what the other’s tasks and responsibilities are. They know whom to ask if they have a question or a problem. 

Ideal M&A Teams 

Deal teams handle the negotiation, closing, and integration stages of the M&A process. An ideal M&A team for most deals can have five members. These members should consist of: 

  • A leader/advisor who has the authority to work with everyone involved and the expertise to understand the necessary steps. This person should be an expert as they will be the one calling the shots. 
  • Accountants/money managers should handle the accounting, taxes, investments, and valuation of the M&A. They will likely work closely with the legal team. 
  • C-suite executives and human resources professionals who will help with deal-making and the agreement’s success once it’s been implemented. 

Last but not least, seasoned legal counsel should be included on your M&A team. M&A attorneys can help you understand all the implications of the deal at hand. Be sure you have attorneys who are experienced with M&A laws and agreements. They will likely need to sign off on every part of the deal, ensuring it complies with local, state, and federal laws. Legal counsel should be considered in the framework of keeping you out of legal trouble instead of helping you out after you are already in hot water. In M&A deals, they can assist with offboarding redundant employees, creating retention agreements and severance agreements. 

Covering your business is always a worthwhile endeavor when you’re entering into M&A. Still, you can go too far by building an unwieldy integration team. These deal teams become especially critical when your company is buying a large company.  

With the necessary elements in place, companies of all sizes that want to grow through acquisitions don’t necessarily need a large corporate M&A group. Instead, they can build up a smaller core of well-versed deal makers who can enlist help as needed.  

Doug Griess and John Snow of Hackstaff & Snow, LLC, are top Denver business attorneys with expertise spanning various industries. Specializing in business law, litigation, intellectual property, tax law, and dispute resolution, John Snow and Doug Griess offer an in-depth understanding and knowledge of general corporate rules and regulations and are a trusted resource for business owners throughout Colorado.  

To Merge or to Stay Independent?


These days there is a flurry of mergers and acquisitions in all industries, but particularly so in the financial services arena. Hardly a day goes by that an independent investment firm does not announce a deal to merge with a bigger company.

Small firms and not so small firms are becoming partners with larger organizations for a myriad of reasons, which begs the questions, why and why now?

Evolving Operations

Owning any business can be complicated, but some of the operational issues involved in running a firm in the financial sector can be especially challenging.

Cybersecurity is a big factor. With what seems like daily news of massive cyberattacks, smaller financial firms are particularly vulnerable. A breach of security involving client data can be disastrous. Larger firms with more robust IT resources have deeper pockets and are often better equipped to handle any potential theft of private information and the liability associated with such a breach.

Compliance is another important facet of running an investment firm. With audits on the rise, companies need to spend an inordinate amount of time crossing their t’s and dotting their i’s when running their day-to-day business. Centralizing the compliance function in a larger organization makes things more efficient and easier when you can have a dedicated team to handle regulatory compliance. At smaller firms, most chief compliance officers are principals at their firms and must wear many hats, rather than specialize in one major area.

Entrepreneurs are often so busy they don’t have time to manage human resources to the fullest. Like compliance, it becomes a function that often gets added to a firm owner’s already sizeable responsibilities. Yet, recruiting, training, on-boarding and retaining employees is crucial in a field like financial services, which often requires technical skills and the importance of building a healthy office-employee culture to create optimal service experiences for clients. Overseeing that process is something best left to a dedicated human resource manager or team of professionals. Larger firms can afford to have specialists in this important area of the firm.

Rising Demand for New Services

Managing money in an increasingly complex world is difficult at best so being able to offer clients additional services makes a lot of sense. The ability to do estate planning, financial planning, socially responsible investing, and provide exposure to private equity and robust alternative investment opportunities is key for retaining clients and keeping pace with the competition. Being a boutique or niche player in a particular market is great when you are getting started, but once you have matured and grown your business as much as you possibly can, you will need to take things to the next level. To continue growing and helping your clients get the best services, you will need a much bigger and well positioned partner.

Better for Employees

Working for a small firm is great on so many levels-you get to participate in all aspects of helping run the firm, you interact with clients at a very personal level, and if you have good bosses, there are endless mentorship opportunities. But there comes a time when your employees need a bigger runway to prosper and grow. Larger organizations are set up to do this with more educational opportunities and structured career pathing opportunities.

The need for operational support, a desire to expand our services offerings, and provide more growth opportunities for our team of employees recently led me and my partners to merge our practice with a much larger firm, Beacon Pointe Advisors. With our new partner we can get back to what we want to focus on when we launched our firm 26 years ago—working more in depth with our clients and spending more time focused on their financial needs and aspirations-without having our attention pulled away to navigate such a complex and challenging business environment. I have not been this excited about our future or our careers since 1995.

Thumbnail Fred Taylor Headshot Current Fred Taylor is a managing director and partner of Beacon Pointe Advisors’ Denver office. He helps individuals and families build wealth, live off their wealth and leave a legacy for future generations. A former economic advisor to Governor Bill Ritter, Fred has more than 35 years of financial services experience.