How to ensure your corporation has the right private market data
May 31, 2017
In the current market, data is essential for corporations to proactively execute their growth strategies. But if you’re in corporate development, how do you know you’re getting all the necessary information? Are you using the best resources out there?
To help you answer these questions, we created a guide that walks you through how to use private market data to stay competitive, evaluate data providers and pick the best database for your company.
Inside, you’ll find:
Insights on the current market and their impact on corporate development
How corporations can use private market data to stay competitive
How to identify your company’s needs
Tools to help you evaluate databases
Read the guide below to make sure you’re getting the best data.
Staying competitive How corporations get ahead with private market data A guide to choosing the best database for your company PG 1 Contents Is your data comprehensive enough 3 Keep up or miss out The startup landscape changes fast 4 More opportunities more noise 5 Precise pricing is more important than ever 6 The competition is challenging to track 7 How to navigate a complex landscape 8 Finding the best database for your corporation 9 The most comprehensive data is on the PitchBook Platform 16 What PitchBook tracks 17 About PitchBook 19 PG 2 In the complex and everchanging market corporations are shifting to more proactive growth strategies Execution requires detailed data that goes beyond tips from your network pitches from investment banks and information from public sources With comprehensive information on every aspect of the private markets including companies deals investors and competitorsyou can make more informed buy build or partner decisions There are many resources available so it can be challenging to ensure youre getting all the information you need and not missing out on relevant datasets This guide walks you through how to use private market data to stay competitive evaluate data providers and pick the best database for your company PG 3 In 2016 globally Keep up or miss out The startup landscape changes fast Today entrepreneurs face lower barriers to entry Software is cheaper to create and improve than manufactured goods SaaS platforms help companies get off the ground faster and run more efficiently And capital from incubators accelerators grants and venture capital firms is more accessible Startups have proliferated and contributed to an environment where industries can pop upand fall flatquickly making it difficult for corporations to determine which emerging markets to enter More and more corporations are participating in venture rounds to stay on top of hot industries and get in early with promising companies To help inform their strategies corporations need a database that provides insight into where deals are happening which industries are growing which companies are gaining traction and what other investors are doing Source PitchBook Trends PG 4 In 2016 globally More opportunities more noise The number of private equitybacked companies continues to grow which creates more opportunities for MA But more opportunities also mean more noise Its challenging for corporations to decide which companies to go after To ensure theyre pursuing the best targets corporations need comprehensive information on companies to help them find and evaluate opportunities They can use a database to search for companies that are a good strategic fit and conduct thorough due diligence Information on venture capital and private equity investments is another way corporations can source promising deals Because VC and PE investors are experts at identifying the best opportunities corporations can leverage insight into portfolios to cut through the noise Corporations can also use a private market database to find top investors in their industries and then build partnerships for exit and coinvestment opportunities Source PitchBook Trends PG 5 Precise pricing is more important than ever Median MA deal size and valuations have continued to rise for the last few years In 2016 the average MA deal size was more than double the average in 2012 With bigger deals accurate pricing is even more important To avoid overpaying for acquisitions and execute deals effectively corporations need information on precedent transactions Detailed deal datalike valuations purchase price multiples and deal sizescan help corporations build accurate comps and price deals precisely In 2016 globally Source PitchBook Trends PG 6 In 2016 globally The competition is challenging to track In 2015 MA deal value hit an alltime high of 22T and 2016 wasnt far behind with a total of 21T spent on MA Corporations are spending more than ever on inorganic growth in order to grow fasterand its challenging for their competitors to predict where theyre going next To keep up corporations need to closely track their competition With a database that provides insight into companies investments and acquisitions corporations can better understand their competitors strategies and adjust accordingly Corporations can also use private market data to see who is doing deals in their industry and stay on top of new competitors Source PitchBook Trends PG 7 How to navigate a complex landscape You face many challenges in the current marketits difficult to determine which industries and opportunities to pursue price deals accurately and keep tabs on your competition Comprehensive data on companies deals investors and strategic acquirers can help you overcome these obstacles and stay competitive With a private market database that covers VC PE and MA you can Trends PG 8 Finding the best database for your corporation If you think youll benefit from private market data take the time to choose your data provider The next few pages will help you identify your needs evaluate your options and pick the best database for you Workbook PG 9 1 Get prepared Form an evaluation team Outline your use cases Include people at all levelsfrom analysts to Also leverage insights from stakeholders to determine managing directors the main ways your team will use the database like sourcing deals or building comps Talk to stakeholders Conduct interviews or send out a survey to get Finalize your requirements a better idea of what people want in a database Show the evaluation team your list of needs and use what data they dont have access to but would cases integrate any feedback and get approval like to how often they use data sources and what would help them work more efficiently Identify your needs Based on the information you gathered from stakeholders compile a list of what you need from a database like datasets features and tools Workbook PG 10 2 Document your current resources and workflow Usability What data sources do you use How much do they cost Timeliness How do you find out when a deal happens in your industry How many people on your team use these sources How do you find out when a competitor makes a deal How often does your team use these sources How do you find out when a new company enters your space How easy is it to use these sources Automation What tasks in your existing research process require human attention or validation Does your team have to scrub data in Excel Customization Can you run custom searches with your current data sources Can you save searches Workbook Speed How long does it take to find promising targets How long does it take to evaluate companies Interconnectivity Can you get information on companies deals investors and competitors from one source Can you access data from your current sources directly in Excel PG 11 3 Identify the options Identify available databases There are many databases out there To create a comprehensive list ask your colleagues and consult online reviews for suggestions Reach out to data providers Ask questions and watch demonstrations to gauge whether a database meets your requirements Many data providers also offer free trials of their products so you can get a better feel for how they work Create a short list Narrow down your initial list to the top contenders Workbook PG 12 4 Evaluate top databases Data breadth database functionality and data provider service Does the database track Yes No Does the database track Yes No Does the database have Yes No Preventure companies IPOs Excel integration VCbacked companies PIPEs Mobile access PEbacked companies Pre and postmoney valuations Advanced search Strategic acquirers Purchase price multiples Saved searches Angel investors Cap tables Custom email alerts Acceleratorsincubators Series terms Analysis tools VC firms Deal sizes PE firms Angel deals Company financials including revenue and cash flow Company leadershipexecutives VC deals PE deals VC and PE funds including industry focus investments and performance MA deals Seed deals Workbook Does the data provider offer Yes No Industry reports Research assistance Unlimited training Reliable customer support PG 13 4 Evaluate top databases continued Data depth and accuracy ROI estimation of professionals who use the database of hours saved on deal sourcing of private companies in the database of deals sourced of deals in the database of hours saved on due diligence of strategic acquirers in the database of hours saved on deal execution of investors in the database increase in pricing accuracy of funds in the database of hours saved on competitive research of researchers of new partnership opportunities where the data provider gets information how often data is refreshed how data is verified how valuations are calculated Workbook PG 14 5 6 Choose your database Prepare for process change Rank top databases Sell your choice internally Use the information youve gathered with the Ask the evaluation team to help you evangelize the previous pages to determine how well each database within your organization and explain its database meets your needs benefits to your leadership Many data providers offer 1 resources to help you get a subscription approved just ask 2 3 Train your team Once you get the green light for a subscription help Pick your database Youve identified your teams requirements facilitate the onboarding process and train your team on the key use cases you outlined previously and evaluated all your optionsnow its time to get approval Workbook PG 15 The PitchBook Platform is the most comprehensive VC PE and MA database Not only does the Platform offer information you cant find anywhere else but it also tracks every aspect of the private markets The official data provider of the Association for Corporate Growth ACG and National Venture Capital Association NVCA PitchBook offers the information you need to make informed buy build or partner decisions