Taking the Pulse of Middle Market Investment Banking

Posted on December 3, 2015

Gabe Galvez is the Founder and CEO of CAPTARGET, an innovative service provider to middle market investment banks, M&A intermediaries and private equity firms. CAPTARGET is in daily contact with a large number of M&A industry participants and has created a comprehensive directory of M&A Intermediary firms, giving Mr. Galvez unique insight into the Middle Market Investment Banking and Transactional Intermediaries Industry.

In a far reaching interview Galvez shared with us his views on the current state of the industry as well as future trends.  Among the most interesting takeaways:

  • Five or six years ago the average middle market boutique M&A firm had five dealmakers
  • Today that number is a bit over two
  • In the same period the number of intermediary firms has grown from 3000 to about 4600
  • Of these more than half have not closed a deal in the past twelve months.

Gabe paints a picture of an industry ripe for radical change starting with a sharp contraction in the number of competing firms over the next several years back down to about 3000, leading to larger firm sizes and higher close rates.  He also draws a roadmap for what he sees as the successful M&A intermediary firm of the future.

While I would readily agree that the middle market intermediary business is far more competitive than when I entered it thirty years ago, there is more to the story.  Since the Great Recession, numerous parties, including real estate brokers, small business brokers, lawyers, accountants and consultants of all stripes have hung their shingles, claiming expertise in middle market M&A.  Websites are inexpensive and FINRA and the SEC have recently walked back regulatory requirements requiring securities registration for middle market intermediaries.  However, in our experience it takes far more than a flashy website to qualify a professional to represent business owners … read the rest

Categories: Gabe Galvez, Interviewees, Investment Banking, M&A, Mergers and Acquisitions, Middle Market

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