If this was forwarded to you, subscribe here - I send two of these a week.
I keep having the same conversation twice a week.
Once with a sell-side banker. Once with a buy-side platform.
Both say they need help with "sourcing." Both describe the same frustration. Both are paying tens of thousands a year for data platforms that get them partway there. But when I ask what the output needs to look like, the conversations split completely.
The thing is - both sides are ultimately trying to reach the same physician founders. The sell-side bank wants to represent them. The buy-side platform wants to acquire them. And the team that shows up with better information is the team that wins the conversation.
Not because data closes deals. It doesn't. But because a banker who can reference a physician's specific competitive landscape, specific market dynamics, and specific practice trajectory in the first meeting earns trust faster than one who leads with credentials. And a corp dev lead who reaches out referencing something specific about the practice - service mix, local competitive environment, a market shift the physician is already feeling - gets a meeting. The one who sends a generic "we're interested in acquisitions in your area" gets deleted.
Physicians live and breathe their specialty every day. They don't need another market overview telling them what they already know. What catches their attention is when someone across the table knows details they didn't expect anyone outside their world to know. The competitive dynamics in their MSA. Which of their peers have already transacted. Where their market is headed in 12 months. The difference between "this is another banker" and "this person actually understands my practice" comes down to that level of specificity.
That's the edge. And right now, most teams on both sides of the table aren't building it.
What Sell-Side Actually Means When They Say "Sourcing"
Sell-side banks need breadth.
When a physician founder is considering a sale, they'll typically take meetings with 3-4 banks. The industry calls this a "beauty contest." Each bank puts together a pitch - team credentials, relevant transactions, preliminary valuation, potential buyer universe, proposed strategy.
But here's what the research shows and what I've heard confirmed on every call with a banker: in many cases, the mandate is decided before the pitch. Senior bankers build relationships with physician founders and PE sponsors over years. The bank that's been in the physician's orbit - the one that showed up with a specific, informed point of view before the formal process began - has a structural advantage no pitch book can overcome.
One PE fund wrote openly about how they choose banks. Their advice: "Express interest in specific portfolio companies. The most unproductive meetings are with intermediaries who are ill-informed about portfolio companies and register a generic interest." And: "Develop relationships early in the investment cycle. By the time a fund starts thinking about exiting, it's possible they already have their short list in mind, and it's too late."
Every bank has their sector overviews. They publish white papers on dermatology consolidation and gastroenterology trends and whatever specialty is getting attention this quarter. That checks the credibility box. But it doesn't differentiate. The physician has already lived through everything in that white paper.
What differentiates is when a banker can walk into that first meeting and say: I know there are 40-some independent practices in your specialty in this MSA. I know which of your competitors have already been acquired and by whom. I know where the whitespace is. I know there are lease windows opening up in the next 18 months for practices within your competitive radius. I know what your market positioning looks like relative to the platforms actively consolidating around you.
When a banker references lease windows, competitor acquisitions, and local market positioning specific to their practice - that's when the physician leans in. That's the moment a banker goes from "one of four" to "the one I want representing me."
But most banks don't invest in this level of preparation until there's a live opportunity. One advisor told me recently: "They don't get interested till they know they're interested."
That's a real constraint. And it's exactly backwards. The bank that builds intelligence before the mandate call is the bank that wins the mandate. The bank that scrambles to build it after is one of three runners-up wondering what happened.
What Buy-Side Actually Means When They Say "Sourcing"
Buy-side platforms need depth.
When a PE-backed platform enters a new market - behavioral health in a new state, GI in a new MSA, whatever the thesis is - they don't need national coverage across 15 specialties. They need to know one specific market cold. Which practices fit the buy box. How many providers, and what type. What the payer acceptance looks like. Who's approaching retirement or recently lost a partner. Who's already PE-backed. Where the whitespace is versus what's already been consolidated.
All politics are local. A 40-location platform in the Southeast doesn't care about the national landscape. They care about the three MSAs they're entering next quarter and whether there are 15 or 50 targets that actually fit their criteria.
I had a call recently with a one-man M&A team at a PE-backed behavioral health platform. He'd built pipelines for two separate markets by hand - Google Maps, ZoomInfo, LinkedIn employee tracking, manually classifying every prospect in Monday.com. He said he'd spent months developing the pipeline. When I walked him through what the same output could look like in days, he said: "I wish I had reached out to you before I did all this work."
What made the conversation interesting was his outreach approach. His initial email sequence was broad - same message across the pipeline. But for the targets he'd identified as high-priority fits based on his buy box criteria, he'd go back and personalize. Check their website, find them on LinkedIn, see if they'd published a talk or a paper - anything that would make the first touch feel specific rather than generic. That personalization is what got responses. But building that knowledge manually for each target doesn't scale - especially when you're entering a new market every quarter.
The failure mode on the buy-side isn't just the upfront cost of a BD hire spending their first 90 days building a list from scratch. It's every time a new thesis gets greenlit or a new market opens up. You want that person dialing with enriched, market-specific intelligence the day the IC says go - not spending weeks building the foundation that should already be there. I wrote about this dynamic here.
The Common Thread
Both sides share the same underlying problem: the gap between the tools and the phone call.
Sell-side banks want rolling coverage across their key specialties so any banker on the team can walk into a mandate pitch informed. Buy-side platforms want depth in one market at a time so their BD hire or deal lead can start conversations on Day 1 with something worth saying.
Both are paying for data platforms that get them facility names and addresses. Neither is getting the provider-level intelligence, the competitive mapping, the succession signals, or the prioritization logic that turns a name on a list into a conversation worth having.
The teams that close this gap are building an advantage that compounds every quarter. The more intelligence you have before the first touch, the better the first touch. The better the first touch, the more conversations that convert. The more conversations that convert, the more deals you see before anyone else.
You should always be building the next pipeline. Not just when a mandate is live. Not just when the IC greenlights a new theme. The deals you close next year are the relationships you start this quarter. And the quality of those first touches - whether you're a banker pitching for a mandate or a platform reaching out about an acquisition - comes down to the quality of the intelligence behind them.
The best targets aren't on the market. They're having conversations with the teams that showed up first with something worth listening to.
If you're on the sell-side and thinking about what it looks like to walk into mandate pitches with real market intelligence instead of a recycled sector overview - or on the buy-side preparing to enter a new market and you'd rather hand your team a ranked, enriched target list on Day 1 instead of watching them build it from scratch - reply to this email. Tell me which side of the table you sit on and what vertical or geography you're focused on. I'll tell you what I'm seeing in that space.
Healthcare M&AI - Shawn
What's the biggest bottleneck in your origination workflow right now - breadth or depth? Hit reply. I read every one.
This newsletter is for informational purposes only and does not constitute investment, legal, or financial advice.