How to align corporate development hires with operational growth

If your business is planning to scale through inorganic growth, hiring a corporate development leader can make all the difference for your M&A strategy.

However, it can be challenging to align a new M&A leader and an existing business development function as you embark on a comprehensive growth journey for your organization.

While corporate development hires will be focused on finding and landing great deals, your business development team will need their collaboration on internal growth drivers as well.

In this article, we share a few important considerations for any organization hiring an M&A leader and how to pair this individual with a business development team.

M&A candidate archetypes

The first step in making a great M&A hire is to study the four main profiles in this field and determine which is best for your hiring needs: manager, rising star, proven commodity or transformative CDO.

1. Manager:
   • 3-5 years of total M&A experience
   • Likely has 2-3 years of investment banking, in addition to 2-3 years of corporate development
2. Rising Star:
   • 6-10 years of M&A experience, likely split between IB and corporate development
   • Has been involved in the deal process and interacted with ownership but has not developed a deal funnel from scratch
   • Has the right skills to lead a transaction, but has not led a corporate development function
3. Proven Commodity:
   • 10-15+ years of M&A with experience in IB and now corporate development
   • Has likely led or overseen deal-sourcing process
   • Proven track record of leading a corporate development function but has not worked “shoulder to shoulder” with a CEO
4. Transformative CDO:
   • 15+ years of M&A experience
   • Has overseen sourcing, execution and integration of new deals
   • Currently reporting to a CEO, with experience leading transformative M&A deals

Generally, you want this hire’s biggest spike to match your biggest pain point, or what the organization views as the most important part of the M&A process.

Related: The ultimate Charles Aris guide to executive recruiting

Matching the right person with your business development function

Often, organizations will anticipate a crossover between corporate development and business development so that their inorganic growth plan and operations growth plan become one in the same.

Otherwise, a corporate development hire in a silo may be too focused on “doing deals for the sake of doing deals.”

We recommend having the private equity sponsor (if applicable) and CEO/CFO be hands on in the onboarding process. This ensures the new hire will be primed on the organization’s broader growth strategy and gain healthy exposure to the operational side of the business.

Most senior-level corporate development leaders will have a track record proving that they only focus on valuable deals that make sense for the business, but this additional oversight will help ensure all parties are aligned.

Download: 2024 Mid-Year Corporate Development Compensation Report

We’ve also found that candidates with private equity experience tend to be best here, as they still possess the right investor mindset (versus pure deal-making mindset).

Organizations that want to fully eliminate any possibility of excess deals will sometimes “hold” a portion of this hire’s deal bonus for 12 months to ensure full alignment with the business development function, but this can result in candidate pushback.

The takeaway:

To successfully integrate a new M&A leader with an existing business development team, organizations should carefully consider the candidate’s experience and fit with their strategic goals.

Involving senior leaders in the onboarding process can further align the new M&A leader’s objectives with the company’s operational growth goals, shifting their focus from pure deal making to a more cohesive growth strategy.

To learn more, contact Josh Kotelnicki at (336) 217-9159 or josh.kotelnicki@charlesaris.com.