Welcome to GT Securities’ January broker-dealer newsletter and Happy New Year!
In this edition, I will share a few ideas to drive more deals and business in 2025. To all of our success!
To all of our success!
To begin, and on behalf of the entire GT Securities team, we wish you and yours a healthy and prosperous 2025.
In our conversations with many of you over the past few weeks, there’s a palpable sense of hope and confidence—a belief that meaningful market tailwinds are heading our way.
Of course, and as always, responsibility for actual results in this “free form” boutique banking business of ours rests squarely on us.
In this spirit, here are three ideas for finding some small advantages that, when stacked together, can turn a lackluster year into an okay one, an okay one into a great one, and a great one into a life changing one:
Think and Go BIG. It may not materialize, above all else geopolitical flashpoints could derail it, but 2025 is shaping up to be a serious bounce-back year for private markets and deals.
Especially when compared to what one of our most wizened platform bankers described as “wet blanket” deal conditions these past few years.
Now to be clear, deals have been and are getting done, in fact in 2024 more of them than in any year in the history of the GTS platform!
But when compared to before the Pandemic they are taking longer, with constrained valuations and frustratingly too often with that dreaded “banker fee compression” dynamic.
2025 holds the promise of reversing these trends. Yes, in 2025 we might all enjoy fast-moving, frothy valuation, and banker fee-friendly deal markets.
So the recommendation here is very simple: Seek out bigger deals, ask for higher fees, and ruthlessly drive timing expectations for them (I like cutting projected deal timelines in half as a starting point).
Movement on just one of these variables can make a difference, movement on all three is practice transformative.
Work the Buy Side. I seem to give this suggestion every year, but in 2025 with so much private equity sitting on the sideline idle and looking to be deployed, it’s worth repeating: If you’re not already doing so, cultivate relationships with holders of capital and position yourself as a conduit for high-quality, under-the-radar deal flow.
The view here is that fund sources – especially foreign fund sources – will in 2025 be looking to do a lot of deals fast and will want help to do so.
And while not always possible nor appropriate, the forecast here (backed up by platform fee data points) is that opportunities to collect 2–5% buy-side fees are out there for bankers that ask for them.
Secondaries. 2025 is really set up to be a bounceback for secondary transactions. For perspective, in 2020–2021, secondaries accounted for more than half of all deals transacted on the platform. From 2022–2024 less than 15%.
Driving the rebound will be the new administration and the mood and tone being set, especially by its cast of “Tech Bros” disruptors and innovators (see Musk, Andreessen, et al).
It is hopeful and optimistic in many dimensions, and for secondaries it presents itself as America again being “open for business” and the indisputable place where so much of the interesting deal action gets done.
This “vibe” is already driving rising private market valuations along with refreshed appetite from institutional buyers of secondaries, especially foreign buyers.
So whether via building relationships with sellers – individual executives at high-flying private companies and / or investors on their cap tables – or with prospective buyers, or both, the secondaries space is a rich opportunity for independent investment bankers to mine.
Next month, as the new administration takes over, I’ll share additional thoughts on sectors, geographies, and product types starting to percolate on the platform.
For now, 2025 is shaping up to be “Why not us? Why not now?” kind of deal year.
Let’s go get it!
Happy 2025 to all!
