The conventional description of M&A sourcing at corporate development teams emphasises the relationship dimension: deal flow comes from advisers, from management introductions, from years of careful cultivation with target founders. This is accurate for the final stages of the process. A deal that closes almost always has a human relationship at its centre. But this framing understates the substantial amount of structured analytical work that precedes any relationship-building activity, and it tends to obscure where analyst time actually goes.
In conversations with corp dev practitioners at UK-listed and private-equity-backed corporates over the past year, a fairly consistent picture emerged of how sourcing time is allocated. It was not the picture that the "sourcing is relationships" framing would suggest. The largest single category of time spent was not relationship management. It was building and maintaining the initial universe: the list of companies that qualify as potential targets before any prioritisation or outreach has occurred.
The Universe Problem
Before you can prioritise targets, you need a universe. Before you can have a relationship with a target, you need to know the target exists. This sounds obvious but has significant time implications that are easy to underestimate.
A corporate development team entering a new vertical or extending coverage to a new geography typically starts with a blank sheet. The question is: who is operating in this space, at roughly the scale we care about, in the ownership configuration we can realistically approach? Answering that question rigorously for a reasonably well-defined UK private sector takes substantial time if done from first principles.
The sources available are multiple and none is complete on its own. A database product like Fame or Orbis gives you the Companies House universe filtered by SIC code and size, but with the gaps that come from incomplete abbreviated accounts coverage and imprecise industry classification. Google and trade press searches surface the more visible companies but systematically miss the sub-threshold and less digitally-active businesses that are often the most interesting acquisitions. Adviser deal trackers show what has been to market but say little about the many more companies that have not yet decided to sell. Competitors' press releases tell you about businesses acquired by your direct competitors, but those companies are already off the market.
Stitching these sources together into a coherent and reasonably complete universe is the work that analysts spend most of their time on, and it is the work that is most amenable to structure and to external intelligence products. It is also the work that, when done poorly, results in a universe that misses substantial portions of the relevant population and produces a target list that systematically overweights the visible and accessible names at the expense of the less visible but potentially more interesting ones.
The Maintenance Problem
Building a universe once is hard enough. Keeping it current is a second, ongoing burden that is easy to underestimate in advance.
Companies in a sector do not stand still. They grow, get acquired, restructure their ownership, change their activity profile, bring in institutional capital, or start hiring in ways that indicate changing intentions. A universe that was accurate twelve months ago needs ongoing maintenance to remain useful as a prioritisation tool. New companies form. Existing companies change hands. The sub-segment boundaries shift as the competitive structure evolves.
The typical approach to this maintenance problem at under-resourced corp dev teams is periodic re-runs of the same database screens that built the original universe. This approach has the advantage of being systematic, but it misses changes that occur between screen runs and it does not capture the dynamic signals (hiring, filing activity, director appointments) that are more predictive of near-term transaction readiness than the static financial data in annual accounts.
Teams that do this well tend to treat universe maintenance as a continuous monitoring activity rather than a periodic refresh. They have a defined set of signals they track on a rolling basis for companies already in the universe, and a defined process for adding new companies when they appear in those signals. This is more operationally intensive than the periodic screen approach, but it produces materially better intelligence for the same reason that monitoring a portfolio of companies continuously is better than reviewing them once a year.
The Prioritisation Layer
Once a universe exists, a second category of analyst time goes into prioritisation: deciding which companies in the universe warrant active outreach in the near term versus those that go into a watch list for future monitoring. This is where the analytical work becomes more judgement-intensive and less amenable to automation.
Prioritisation criteria are typically a combination of strategic fit (does this company's capability profile strengthen our position in a way that is differentiated from what we can build internally?), financial profile (is this company at the scale and margin profile that makes economic sense at the prices these assets typically trade at?), and transaction readiness (are there signals that suggest the owner is approaching a decision point?).
The first two criteria are relatively stable for a given corporate's strategy and can be applied at scale across a large universe. The third is the dynamic one, and it is where the signal quality of the intelligence source matters most. A static database screen does not distinguish between a company that is perfectly positioned for approach today and one that will be receptive in two years. The hiring, filing, and ownership signals that Thema tracks are specifically designed to surface the transaction readiness dimension that static financial data cannot provide.
The Outreach and Relationship Phase
A much smaller fraction of analyst time goes into the outreach and relationship phase than the universe and prioritisation phases, at least at the junior-to-mid analyst level. This is the phase that gets the most attention in descriptions of how sourcing works, because it is the most visible and because success in it is often what determines whether a deal closes. But it is not where the time goes.
The implication for corp dev team design is underappreciated. If the universe and prioritisation phases are the time-intensive ones, and if those phases are most amenable to structured intelligence input, then the productivity gain from improving those phases is proportionally large. A team that spends forty percent of its sourcing time building and maintaining a universe that is materially incomplete will miss a corresponding fraction of the opportunity set, regardless of how well it executes the relationship phase.
The analogy to research in other investment contexts is direct: a fund that has incomplete coverage of the investable universe will systematically underperform a fund with complete coverage, holding execution quality equal, because the set of opportunities it can choose from is smaller. Corp dev teams face the same constraint.
Where Thema Fits
Thema was designed specifically around the universe and prioritisation problem. The sector maps we deliver are not designed to replace the relationship work that closes deals. They are designed to ensure that the set of companies on which that relationship work is performed is as complete and well-prioritised as it can be, given the available evidence from the public record.
For a corp dev team setting new sector coverage, the Thema deliverable gives them a structured starting universe with signals attached, in a format they can begin working from immediately rather than after weeks of analyst time building the same universe from first principles. For an established team with existing coverage, the signals layer provides the continuous monitoring that makes it practical to track a large universe without dedicating analyst time to periodic re-runs of the same database screens.
The relationship work that converts a prioritised target into a closed deal is still entirely theirs to do. We are not in that part of the process. We are in the part that comes before it and that determines how well the relationship work is directed.