Why corporate development

Business Development focuses more on the market; bringing in customers, working with vendors, and marketing. Consequently, Business Development activities often include marketing and sales related tasks. Both genres of development clearly include networking and developing relationships and partnerships. As Corporate Development teams become more common, and tools are generated to help them with their strategies and deal management, it is easy to see more and more companies are relying on the creativity and skills of Corporate Development leaders to enhance and grow their businesses.

Consequently, it becomes essential for Corporate Development practitioners to cultivate genuine relationships and avoid the all too tempting comfort of putting their heads down and blindly following playbooks. Empower collaboration, efficiency, and accountability.

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About DealRoom. Book a demo Log in. DealRoom office hours with halo and paylocity. DealRoom FAQ. Related articles No items found. Unlike many private equity and hedge fund roles, corporate development is open to more than just elite boutique and bulge bracket bankers.

You could also potentially get into corporate development coming from a job in private equity, such as Private Equity Analyst. Corporate development teams sometimes hire internal candidates, such as ones who are in corporate finance rotational or data science roles.

It is very rare for students to get into corporate development straight out of undergrad. By contrast, you could do well at a hedge fund if you can sit in a room, do a ton of research and analysis, and come up with insights.

If you want to start in corporate development, you should target smaller, higher-growth firms, such as startups with a few hundred people but not, say, a few thousand. So, while a wider variety of candidates have access to corporate development recruiting, it can be challenging to find positions or companies that are hiring.

If the private equity recruiting process in North America is early, highly structured, and driven by headhunters, then corporate development recruiting is more like off-cycle private equity recruiting :.

Some PE-owned companies may still use headhunters if they need to hire someone ASAP, but most CD teams skip headhunters and rely on referrals and internal candidates. If you cannot win referrals from the senior staff, then the next best option is to find companies that have posted corporate development positions on job sites. Then, look up those companies on LinkedIn, find professionals in the CD team, and email them to introduce yourself and ask about opportunities at the firm.

The questions vary significantly because CD professionals have very different backgrounds, and so do the candidates. For example, a single team could have former bankers, former Big 4 professionals, a former software engineer or biochemist, a former data scientist, and a former integration consultant. In many teams, the most important qualities are industry background and fit — especially if it is something specialized or technical, such as pharmaceuticals or biotech.

You would have a huge advantage at that type of company if, in addition to deal experience, you also knew about the drug lifecycle, the government approval process, clinical trials, the business models of generics vs.

If the company is in an unusual location e. We covered the key points about your deal experience in the article on investment banking deal sheets , and everything there applies to corporate development recruiting as well.

You should take a look at the article on investment banking interview questions and answers because all the technical questions there apply here as well. Unlike in corporate finance, where questions beyond accounting are unlikely, anything could come up in corporate development recruiting since you value companies and model transactions. In corporate development recruiting, these should be quite similar to the fit questions in investment banking interviews , so refer to that previous article.

Those topics could come up, but interviewers are not going to spend 30 minutes grilling you about a bad grade in a 1 st year accounting class, whereas a banker going through a mid-life crisis could easily do that. For example, there might be an upfront payment, commissions for back-end or subscription sales, bonus incentives if certain goals are met, penalties for underperformance, and so on.

Once you have some ideas, pitching an acquisition or JV is similar to pitching a stock , but with a different focus because of the long-term nature of corporate development. There are four main types of case studies you can expect in corporate development recruiting, ranked below from most common to least common:. With the on-site, minute tests, avoid over-complicating the case study and get to a quick answer.

With take-home case studies, you still want to keep the models relatively simple, but you should go above and beyond with your market research. For example, instead of stopping at a deal recommendation, research the market and present another few acquisitions that might make more sense than the original idea and give rough valuation ranges.

If you want to practice these types of case studies, we include 17 examples with full solutions in the IB Interview Guide plus, technical questions, fit questions, deal discussions, and more. And if you want to learn the fundamentals from the ground up, including the key Excel functions and shortcuts and the concepts behind all the models, check out the Financial Modeling Mastery course.

As a result, they sometimes get busy with deals and have to put interview processes on hold for months. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron. It starts where the legal formalities for the partnership paved the ground and where now the practical implementation has to follow. The corporate development teams, again, face the daunting task on the one side to liaise with the new partner but, at the same time, understand and liaise appropriately with several relevant departments and units within their own companies.

Putting it in a nutshell: in this scenario, the CDA becomes responsible for getting a joint venture under way. Corporate development, of course, also was instrumental in preparing such cooperation for the CEOs and board to sign. The benefits and synergies had to be carefully analysed, the pros and cons weighed, projections about risks and profits had to be made. Desired workforce and HR-related issues had be contemplated and the overall financial framework had to be checked and double-checked before a final proposal for such corporate development project could be presented to the C-level stakeholders and subsequent board approval.

This example will have demonstrated why corporate development is becoming commonplace with larger companies. Please note that next to the financial implications of corporate development there is always a structural aspect with regards to achieving desired corporate changes. This means bringing together all players involved in a coordinated and well orchestrated approach — internally as well as externally.

In the case of the hypothetical joint venture between Audi and Bosch both companies have to engage in a fruitful dialogue. This is often part of the role of the corporate development teams involved. As can be seen in thousands examples across the globe during the last decades, corporate development has become a necessary new function within larger companies.

Corporate development, once introduced as an integral function of the routine structures of a company or even large-scale organisation, is defined as a function. In most companies, corporate development is now a constant line function, reporting directly to the C-level.

Corporate development is closely embedded in the corporate strategy and not surprisingly influences it.

If a company embarks on introducing corporate development as a separate function or unit it is generally introduced in form of a small team, perhaps with a number of additional virtual members external resources.

Often, you may add a few staff members who are considered as part of the virtual team. This underscores that corporate development, still, is not yet a fully integral part of most company structures. Due to the dynamism and fluidity of corporate development per se companies prefer to think of reducing their corporate development team than increasing it. This is one area where high skilled online freelance talent marketplaces can step in, allowing corporate development officers to flex their teams up and down on demand.

It does not surprise that, generally, such teams do not even command their own budget. Though it is more than common sense to form a small, independent corporate development team when seeing possible mergers, new business ventures, divestitures or spin-offs through, giving such team proper financial independence and more recognition is still largely unheard of. This perception overlooks the fact that larger companies more or less regularly are involved in one or the other corporate development project.

As mentioned earlier, corporate development should be recognised as a fluid process, a continuous corporate affair — not a singular event. Corporate development teams liaise regularly in-house with the legal team when it comes to help with tax diligence, tax structuring and board and stakeholder approval.

Similarly, a good rapport has to be established with the sales and marketing department for help with opportunity analysis, portfolio asset valuation review or commercial diligence. Thus, when it comes to the evaluation of its own performance, a corporate development team is most frequently measured on the fit of deals with corporate strategy, project management and deal pipeline.