M&A Advisory Firms vs Boutiques: A Founder's Decision Framework
Founders preparing for an exit face a decision that will shape their entire transaction: who should represent them? The advisory landscape ranges from global investment banks to regional firms to specialist boutiques, each with different capabilities, economics, and incentive structures. Choosing poorly does not just affect fees; it can determine whether you reach the right buyers, run an effective process, and ultimately achieve the outcome your business deserves.
The mistake most founders make is treating this as a prestige question. They assume the biggest name will deliver the best result, or conversely, that a boutique will always offer more attention. Neither is universally true. The right choice depends on your transaction size, the complexity of your business, the buyer universe you are trying to reach, and what kind of partnership you need through a process that may last six to twelve months.
Understanding the Landscape
The advisory market segments roughly by deal size, though boundaries are fuzzy and overlap is common.
Business brokers typically handle transactions below $5M in enterprise value. Their model involves high volume, standardised processes, and listing-based marketing. For Main Street businesses selling to individual buyers, this model works. For technology companies with strategic value, it rarely does.
Lower middle-market advisors and boutiques focus on transactions from roughly $5M to $100M in enterprise value. Divestopedia notes that these firms specialise in particular aspects of M&A, with senior dealmakers directly involved throughout the process. Their fee structures typically align heavily with outcomes.
Regional investment banks handle transactions from $100M to $1B. They maintain multiple offices, broader sector coverage, and deeper resources than boutiques, but charge correspondingly higher fees to support that infrastructure.
Bulge bracket banks focus on transactions above $1B, occasionally taking select upper middle-market deals when strategic importance or relationship factors justify it. Their fees carry significant premiums, and their attention model prioritises the largest mandates in their pipeline.
The technology sector complicates these categories. A SaaS business with $10M ARR may have strategic value far exceeding its current revenue, making it attractive to advisors who typically work at higher deal sizes. Conversely, a services-heavy tech business may be better served by an advisor who understands the nuances of revenue quality regardless of topline size.
What Actually Drives Outcomes
Advisory selection matters because the process your advisor runs determines which buyers you reach and how those conversations unfold. The variables that matter most are often invisible until you are mid-process.
Senior Attention
In larger firms, the partners who pitch for your business are rarely the ones who execute it. Junior staff handle buyer outreach, diligence coordination, and much of the negotiation support. This model works for commoditised transactions where process templates apply cleanly. It breaks down in founder-led tech businesses where the story is complex, the buyer universe is non-obvious, and credibility with acquirers depends on deep knowledge of your specific situation.
Boutiques typically offer direct access to the same senior professionals from pitch through close. This continuity matters when a buyer raises an unexpected concern and your advisor needs to respond intelligently, or when a negotiation requires creative structuring that only someone who truly understands your business can propose.
Buyer Network
Every advisor will claim extensive buyer relationships. What matters is whether those relationships are relevant to your transaction. A bulge bracket bank with deep connections to Fortune 500 corporate development teams may be perfect for a large platform sale. Those same connections are less useful if your optimal buyers are vertical software PE firms or mid-market strategics in adjacent sectors.
The right question is not "how many buyers do you know?" but "which specific acquirers have you transacted with in my sector, at my deal size, in the past two years?" An honest advisor will name names and explain why those relationships would be activated for your process.
Process Quality
Running a competitive process is both art and science. The science involves identifying the right buyer universe, sequencing outreach appropriately, managing information flow, and maintaining deal momentum. The art involves reading buyer intent, knowing when to push and when to wait, and structuring conversations to maximise competitive tension without triggering fatigue.
Advisors who run many similar processes develop pattern recognition that improves outcomes. But "similar" is the operative word. An advisor who excels at selling manufacturing businesses to PE may struggle with a SaaS sale to a strategic acquirer. The skills transfer imperfectly.
Fee Structures and Alignment
How an advisor charges reveals what they are optimising for. Current market data shows considerable variation in fee structures by deal size and advisor type.
For transactions in the $10M to $30M EBITDA range, success fees typically fall between 4% and 7%. Smaller transactions command higher percentages (7% to 11% for businesses under $1M EBITDA), while larger deals above $100M in enterprise value see fees compress to 1% to 2%.
Retainer structures vary significantly. Some advisors charge substantial upfront engagement fees ($50K to $150K depending on deal size) to cover process costs and ensure seller commitment. Others work on pure success fees, accepting more risk in exchange for the full economics if a deal closes.
The structure matters less than the alignment it creates. An advisor with a large retainer already banked may be less motivated to push for the last dollar of value in a negotiation. An advisor on pure success fees may be more aggressive, but also more likely to encourage a suboptimal deal if the alternative is no deal at all.
The most aligned structures tie economics to outcomes. Accelerators that pay the advisor a higher percentage above a target valuation create shared upside. Such arrangements are increasingly common in the market, reflecting an evolution toward better alignment between advisor and founder interests.
The Real Trade-offs
There is no universally superior advisor type. The trade-offs are genuine.
Boutiques offer: senior attention, sector depth, aligned fee structures, and often more flexible engagement terms. They may lack the brand recognition that impresses certain buyer types, the resources to run massive global processes, and the financing capabilities to support transactions that require capital markets access.
Larger firms offer: brand credibility with corporate boards, broader buyer networks (especially for cross-border transactions), research and valuation support, and the ability to handle complex transactions involving financing, regulatory approvals, or public company considerations. They charge for that infrastructure, and their attention models prioritise their largest mandates.
For a founder selling a $30M ARR SaaS business to strategic acquirers in a defined vertical, a sector-specialist boutique may deliver better attention and outcomes than a regional bank spreading resources across a diverse deal pipeline. For a $200M platform sale requiring outreach to both strategics and large PE firms across multiple geographies, a larger firm's infrastructure may justify its premium.
How to Evaluate
The pitch process itself reveals much about how an advisor will perform. Pay attention to:
Who shows up. Are the senior people who would lead your deal in the room, or are you meeting partners who will hand off to associates after winning the mandate? Ask directly who will run your process day-to-day.
Their knowledge of your market. Can they speak intelligently about your competitive landscape, buyer universe, and relevant comparable transactions without reading from slides? Deep sector knowledge is difficult to fake.
Realistic valuation guidance. Advisors competing for your business have incentives to suggest aggressive valuations. Be wary of outliers who promise multiples significantly above others. Ask what specific transactions support their range and what factors would need to hold for you to achieve the high end.
Process specifics. How many buyers will they approach? In what sequence? How do they handle confidentiality? What is their typical timeline from engagement to close? Vague answers suggest a templated approach rather than a thoughtful strategy for your specific situation.
References that match your profile. Speaking with founders who have sold similar businesses is more valuable than general endorsements. Ask about what went well, what the advisor could have done better, and whether the final outcome matched expectations set during the pitch.
Timing Considerations
When you engage an advisor matters as much as whom you choose. Starting conversations 12 to 18 months before a targeted transaction allows time to address issues that would otherwise hurt valuation or derail diligence.
A good advisor will be honest if your business is not ready for market. They may recommend improving retention metrics, cleaning up financials, building management depth, or waiting for growth to inflect before launching a process. An advisor desperate for mandates will take anything that might close; a confident one will suggest waiting if waiting serves your interests.
Early engagement also provides time to build the relationship. You will spend months working closely with your advisor through a high-stakes, emotionally charged process. Knowing whether the chemistry works before you are committed is valuable.
What Matters Most
Strip away the marketing, and advisory selection comes down to a few questions: Will this firm reach the buyers who will pay the most for my business? Will the people doing the work understand my company well enough to represent it effectively? Are their incentives aligned with mine? Can I work with them through a difficult process?
Brand names and fee structures are inputs to those questions, not answers. The founder who chooses a prestigious bank because it impresses their board, or a cheap broker because the fees are lower, has optimised for the wrong variable.
The right advisor for your transaction is the one who will run the best process for your specific situation. That might be a global bank, a regional firm, or a specialist boutique. The only way to know is to evaluate multiple options, ask hard questions, and trust your judgment about who actually understands your business and is positioned to maximise your outcome.
If you are beginning to think about an exit and want to understand how different advisory approaches might apply to your situation, we are happy to discuss.