Proprietary Is the New Unicorn

Private equity sponsors point to proprietary access and auction wins as their toughest hurdles, while consultants struggle to identify quality targets. Corporate development teams face network gaps, and bankers push to maintain sourcing velocity with lean resources. The common thread: securing deals now demands sharper differentiation, data-enabled tools, and deeper relationships than ever before.

Deal Sourcing Under Pressure: Where the Biggest Challenges Lie

As competition for attractive opportunities continues to intensify, the dealmaking environment is shifting in ways that are reshaping how private equity sponsors, consultants, corporate development teams, and bankers approach sourcing. Our latest micro-survey asked:

“Which part of deal sourcing has become the most challenging recently?”

The responses, drawn from 75 industry professionals, provide a nuanced picture of where the sourcing bottlenecks lie—and how different market participants experience them.

Key Takeaways at a Glance

• Accessing proprietary opportunities is the single biggest challenge overall, cited by 27% of respondents.
  

• Winning in competitive processes and finding quality targets are nearly tied at 20% each, showing how crowded dealmaking has become.
  

• Building trusted networks and keeping sourcing velocity with lean teams are meaningful challenges, but less acute across the broader base.
  

• Breaking down the data by respondent group reveals sharp differences—PE sponsors struggle most with access and winning, while consultants grapple equally with three fronts: access, networks, and target quality.

Accessing Proprietary Opportunities: The Top Pain Point

Across the full respondent base, more than a quarter pointed to accessing proprietary opportunities as their hardest task. For PE sponsors, the pain is especially acute—40% selected this as their top challenge.

Why? In today’s crowded market, proprietary opportunities have become the holy grail: less competition, better valuations, and stronger alignment with founder-led or family-owned businesses. But as more firms emphasize outbound origination and thematic sourcing, the bar for what counts as “proprietary” is rising. Sponsors are finding that nearly every company they approach is already in conversations with multiple suitors.

The Battle in Competitive Processes

Closely behind proprietary access is the challenge of winning in competitive processes, chosen by 20% of all respondents. Here, PE sponsors again stand out, with 40% highlighting it—underscoring the double bind they face: not only is it hard to find unique deals, but even when opportunities arise, competition is fierce.

Bankers see this dynamic too, though for them the challenge is more evenly distributed across categories. 23% cited proprietary access, but another 23% named competitive wins, reflecting their front-row seat to crowded auction dynamics.

The upshot? Differentiation matters more than ever—whether through speed, certainty of close, thematic expertise, or creative structuring.

Finding Quality Targets in Key Sectors

One of the most surprising findings: 20% of all respondents flagged the scarcity of quality targets as their toughest challenge.

This was particularly pronounced among consultants, where a full 33% cited it, along with another 33% citing proprietary access. For consultants, whose role often involves helping clients frame market landscapes, this signals a growing frustration: even when opportunities exist, they may not meet the thresholds of scale, growth, or resilience investors demand.

Corporate development professionals echoed this sentiment, with 14% highlighting the target scarcity issue. This reflects the strategic filters corporates apply—where alignment with existing portfolios, synergy potential, and cultural fit can narrow the viable universe dramatically.

Networks and Velocity: The “Operational” Challenges

While less headline-grabbing, network-building (17% overall) and keeping sourcing velocity with lean teams (16%) remain persistent headwinds.

• For corporate development teams, network-building was more acute (29%) than for other groups, suggesting they may lack the embedded deal flow pipelines that dedicated sponsors enjoy.
  

• For bankers, maintaining velocity mattered more, with 19% citing it, reflecting the grind of running lean teams in a fast-moving market.

These findings remind us that sourcing is not just about market dynamics—it’s also about organizational capacity. Firms that invest in dedicated origination functions, data-enabled outreach, or relationship coverage often fare better at sustaining the pace.

What This Means for the Market

Taken together, the results highlight a bifurcated challenge:

1. Structural Market Dynamics: Competition and scarcity are making it harder to secure attractive deals, whether proprietary or via competitive processes.
   

2. Operational Execution: Internal resourcing, network cultivation, and relationship coverage remain bottlenecks that firms must address.

For investors and dealmakers, the implications are clear:

• Differentiation is survival. Sponsors need to articulate not just why they can close, but why they bring unique value to the target.
  

• Technology and data tools will matter more. While not a panacea, AI-enabled sourcing platforms and thematic mapping can give teams an edge in spotting overlooked opportunities.
  

• Relationships are still king. Even as tech tools rise, trust-based relationships—especially with founders and advisors—remain critical in accessing proprietary opportunities.
  

• Resourcing origination pays off. Firms that invest in sourcing infrastructure, whether via dedicated teams or outsourcing, are better positioned to sustain velocity.

Looking Ahead

This survey is part of our ongoing PE150 Micro-Survey Series, designed to capture real-time insights from across the dealmaking ecosystem.

Next week, we’ll explore: “Tech vs. Touch – What Gives You Edge?” Do firms see their greatest sourcing edge in AI-driven efficiency, or in human-driven relationships and expertise?

If this week’s results are any indication, the answer may well be both. But the balance—and the conviction behind it—will be telling.