What Corporate Development Actually Requires
Every company that decides to grow by buying other companies starts in the same place. Someone puts a slide together. It has a map on it, or a set of boxes, and it explains that the company will expand into 3 adjacent markets over the next 5 years. The slide is not wrong. It is just not a capability.
A strategy is a statement about what you intend to do. A capability is the set of relationships, habits, and hours that let you actually do it. The gap between those 2 things is where most growth plans quietly die, usually without anyone announcing the funeral.
Strategy is the easy half
I have sat across from owners who could describe their target profile in real detail. Revenue band, geography, customer type, why it fits, what it would unlock. They had thought about it seriously, sometimes for years. Then I asked how many businesses matching that description they had looked at in the last 12 months, and the number was 2. Both had come in over the transom from a broker who sends the same email to 400 people.
That is not a strategy problem. The strategy was fine. The company simply had no mechanism for turning it into a stream of real options.
Three things most companies do not have
Sourcing relationships. The businesses worth buying are usually not the ones being marketed hardest. They come from intermediaries who think of you first, from owners who have met you before they were ready to sell, and from a network that took years to build and needs constant tending. If your deal flow consists entirely of what shows up in your inbox, you are shopping from a picked-over shelf and paying retail for the privilege.
Evaluation discipline. Discipline sounds like a personality trait. It is not. It is a process that produces a fast, consistent no. Most companies do not have one, so every opportunity gets the same treatment: a few weeks of distracted attention, a model built by someone with a day job, and a decision driven by whoever in the room was most enthusiastic. Enthusiasm is a terrible filter. It is loudest exactly when it should be quietest.
Execution bandwidth. This is the one that surprises people. A live deal is not a project you add to someone's plate. It is a second job with unpredictable hours and hard deadlines set by other people. When your CFO takes it on, two things happen at once. The deal gets the leftovers of their attention, and the finance function gets the leftovers of what remains. I have watched companies close an acquisition and spend the following year fixing the damage done to the business that was already working.
What the function actually looks like
Day to day, embedded corporate development is unglamorous, and that is the point.
It is a maintained target list, not a wish. It is regular contact with intermediaries so you hear about a business before it is packaged. It is a first-pass screen that takes hours rather than weeks, because most opportunities can be ruled out on 2 or 3 questions if you know which 2 or 3. It is a model that gets built the same way every time, so this deal can be compared to the last one honestly.
It is also the willingness to look at a lot and buy very little. A disciplined program might review 50 businesses to buy one. That ratio reads like inefficiency to people who have not done it. It is the opposite. The 50 are what make the one worth owning. Volume is not the cost of the function, it is the function.
And it is the part after signing. Diligence coordination, close management, and the first 90 days when the acquired business is watching to see whether anything you said was true.
The question to ask yourself
Not "do we want to grow through acquisition." Almost everyone says yes to that.
Ask instead: who here has 3 hours a day for this, every day, for the next 2 years? Who has the relationships to see the businesses that never get listed? Who is going to say no to the deal that everyone has already gotten excited about?
If the answers are nobody, nobody, and nobody, you do not have a corporate development function. You have a slide. That is a fine place to start, but it is worth being honest about which one you have before you tell the market you are acquisitive.
The companies that do this well are rarely the ones with the best strategy. They are the ones who built the machine, then let it run long enough to work.