AI for M&A Deal Sourcing Quiz

Answers and explanations appear as you take the quiz.

1. Why is the private middle market the hardest part of M&A deal sourcing for AI tools to cover?
   • Private companies are legally barred from appearing in commercial databases
   • Many private businesses publish little beyond a website, a few job posts and an occasional press release
   • Private companies file more complex financial statements than public companies
   • AI models are unable to process text written about small companies
2. When a sourcing platform shows a private company's annual revenue, what is that figure usually?
   • An estimate built from proxies such as headcount and web traffic
   • An audited figure taken from the company's tax filings
   • A number the company is required to report to securities regulators
   • The size of the company's most recent bank loan
3. A user pastes in a known company and asks the platform for lookalikes. What mechanism usually makes this work?
   • Matching the company's exact industry classification code
   • Randomly sampling companies from the same state
   • Comparing embedding vectors of company descriptions and returning the closest ones
   • Asking analysts to build the list by hand overnight
4. Which of these is an acquisition signal the guide describes sourcing teams monitoring?
   • The company redesigning its logo
   • A small dip in the company's social media follower count
   • The company switching email providers
   • A long-tenured founder with no obvious successor in leadership
5. What problem does entity resolution solve in deal sourcing data?
   • Estimating a company's EBITDA margin from its job postings
   • Recognizing that one firm can appear under a legal name, a trade name and several domains, which otherwise creates duplicates or false merges
   • Translating foreign-language company websites into English
   • Predicting the final sale price of a target
6. Why do relationship-intelligence tools such as Affinity and Intapp DealCloud matter in sourcing?
   • They replace the need for any outreach to company owners
   • They guarantee exclusive rights to acquire a target
   • They map who at the firm knows a target's leadership, and warm introductions convert better than cold emails
   • They generate audited financial statements for private targets
7. Why can two companies with the same headcount receive badly wrong revenue estimates?
   • Headcount data is always collected once every ten years
   • Revenue estimates are based only on the length of the company name
   • Platforms deliberately add random noise to protect private companies
   • Estimates often multiply headcount by an assumed revenue per employee for the sector, and that figure varies widely between business types such as services and software
8. According to the guide, where will competitive advantage shift as more firms use the same sourcing platforms?
   • Toward proprietary relationships, sharper investment theses and faster, more credible follow-up
   • Toward buying larger lists of companies from more vendors
   • Toward sending more automated emails to more owners
   • Toward relying entirely on AI-written letters to owners