M&A Advisory – Equity vs. Debt Explained

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M&A advisory is the business of buying and selling businesses. It connects ambitious buyers with willing sellers, whether advising entrepreneurs on the sale of their company or guiding private equity (‘PE’) firms through complex acquisitions and mergers. It is a game of high-stakes matchmaking powered by strategy, negotiation, analysis and deal execution.

M&A professionals serve as trusted advisors to business owners and acquirers. The role is commonly fast-paced, with short deadlines and a large workload. Effective execution requires specialised expertise, relationship and project management skills and the ability to clearly articulate strategy and complex topics so stakeholders can quickly make decisions. It is a competitive, lucrative environment where business owners seek the best in the industry to get their desired transaction outcome. Technical skills are a given – every M&A advisor must understand the intricacies of business in the transaction, including the key commercial aspects of the business model, regulations, recent similar transactions and trends in the industry. As an M&A junior, you will quickly learn the technical skills required. Everyone working in the industry has these. However, in the more senior roles, it is the ability to tell the sales narrative or the credit story of the business, as well as having a clear style of explaining key objectives of the transaction and negotiating to achieve the best outcomes. These factors differentiate the good from the great advisors. Fundamentally, M&A advisory on the equity and debt sides differs significantly in terms of why they tell the business narrative, what they explain and how they negotiate. Let's break down how equity and debt advisors operate to better understand these differences, starting with their core objectives and roles.

Equity vs. Debt M&A Advisory: What’s the difference?​

Imagine selling a high-growth SaaS business to a PE firm—or structuring the debt to fund its acquisition. Both involve M&A advisory but require fundamentally different skill sets.​

Objective and Role:​

Equity focuses on the upside. Debt focuses on the downside.

Equity advisor: Focuses on growth in business profit and potential upside – aka Price maximisers

• On the sell-side (i.e. the advisor is selling the business): Advisors seek to maximise the sales value of the business
• On the buy-side (i.e. working with the bidder looking to purchase the business): Advisors assist the bidder in acquiring the business on the best terms possible

Debt advisor: Focuses on cashflow certainty and mitigating downside risk – capital structure experts

• On the sell-side (aka lender education): Advisors provide potential bidders with clear information on debt available to support funding for their purchase of the target business
• On the buy-side: Advisors work with the successful bidder to raise debt for the new business, achieving the best terms possible

While the end goal of a successful transaction is shared, each advisor's process differs substantially in how they present the business, run the deal and engage with their respective audience.

Process Difference​

Equity focuses on the big-picture investment story for investors. Debt focuses on credit story, cash flow certainty and credit structuring consideration for an audience of lenders.

Equity advisor: The audience is potential investors (Private equity and trade buyers)

• Run the auction process for the sale of the business. Project manage the overall sales process, setting the timeline. This results in more project management tasks (e.g., arranging due diligence provider quotes).
• Develop a business sale narrative for each buyer group, typically across financial buyers (PE firms and family offices) and strategics (corporates)
• Creating investor materials should focus on strategic positioning, growth potential and future upside to potential buyers
• Preparing a financial model supporting the equity case, which typically forecasts a hockey stick shape (showing strong growth) in revenue and profitability

Debt advisor: Audience is lenders

• Creating a debt raise timeline informed by key bid dates in the M&A process
• Develop a ‘credit story’ based on intended funding structure
• Adapt M&A investor materials for potential lenders. Focusing on downside protections, providing more technical information to lenders on the financials and cashflow
• Financing case financial model developed, typically a reduced forecast from the equity case to show that the debt structure can still be comfortably serviced with assumptions heavily scrutinised

These distinctions in the process significantly shape the day-to-day experience of first-year analysts and can provide a very different experience.

What it’s Like as a First-Year Analyst​

Both roles will be fast-paced, have high stakes, and require long hours. Equity advisory will involve more PowerPoint and strategic positioning, while debt advisory will be more Excel and research-heavy, focusing on structure and credit.

Equity advisor: Heavy focus on PowerPoint-based deliverables, including Information Memorandums (IM) and pitch books

• Lots of time in PowerPoint writing IMs and pitch books
• Researching comparable transactions (‘comps’) and target company competitors
• Building buyer lists
• Preparing financial models
• Managing NDAs, project management, coordinating due diligence tasks
• Joining potential client discussions

Debt advisor: More Excel and research-heavy

• Debt sizing and credit analysis
• Financial modelling and covenant analysis
• Lender information preparation and pitch books
• Finding debt transaction comps
• Attending lender calls and meetings

Over time, your work in each role builds a distinct set of skills, allowing you to take on more of the process as you gain experience.

What You’ll Learn​

Both skills will provide a similar core skillset. However, equity advisory will provide more expertise in return analysis and valuation, sale and purchase agreement negotiation and closing mechanics. Debt advisory will focus more on cash flow analysis, debt sizing, stress testing, loan structuring, and negotiation.

Equity advisor:

• How to sell a business’ growth and potential upside story
• Valuation methodologies
• Financial model returns analysis
• Commercial understanding of key industries
• Project management
• Closing mechanics
• Sale and purchase agreement negotiation

Debt advisor:

• Debt sizing – determining how much debt a business can borrow
• Credit analysis – identifying the key risks and mitigation strategies
• Detailed cashflow forecasting analysis
• Financial modelling, including scenario analysis and stress testing
• Debt market and structuring options
• Loan document negotiation (alongside legal counsel)

Given the difference in focus, process and skill development, certain personality traits and preferences align with one path over the other

Who Typically is Better Suited to Each Role​

• Equity advisor: commonly seen as a strategic, commercial and salesman person. Someone who is good at strategic positioning and selling the idea. Builds and maintains strong relationships while having strong negotiating skills, which result in favourable agreements.
• Debt advisor: commonly seen as more of a technical role, where problem-solving, detail-oriented understanding of businesses is required, alongside identifying and managing risk through structuring for downside scenarios. Typically suiting more of an analytical person.

That said, the distinction is more a matter of emphasis. Both roles demand storytelling, commercial acumen, interpersonal skills and technical expertise.

Whether you're drawn to the commercial storytelling of equity advisory or the analytical rigour of debt advisory, both paths offer exciting, high-impact careers in the M&A world. If the above has been helpful, please share it with others exploring M&A. Feel free to comment with questions or share your experience in M&A Advisory.