Answers · Private equity
How do you choose an outsourced deal origination firm for a private equity fund?
Stourhead Holdings · Updated 6 October 2026
Short answer
Judge an origination firm on four things: whether it maps your whole addressable market or just works a list, who reads the owner replies, whether its fees follow your outcome, and what you keep when the engagement ends. Most firms are strong on one of these and quiet about the rest, and the quiet parts are where the money goes.
The four tests
1. Universe or list
Ask to see how the firm builds the target set for a mandate like yours. A list is a database export filtered by industry code and headcount. A universe is rebuilt from the ground up: who owns what, which companies show the signals your thesis cares about, and which decision makers can actually say yes. The difference is the share of the market you never hear about.
2. Who reads the replies
Owners reply in ways that are easy to misread. A polite decline can be timing. An enthusiastic reply can be a business that will not survive diligence. The question is who makes that call before it reaches your partners, and what that person has personally closed. If the honest answer is a junior sales team, your associates will end up doing the screening anyway.
3. Where the incentives point
A per-meeting fee rewards volume. A success-only fee rewards whatever closes fastest, which is rarely the best fit. A retainer with a success component, backed by a written standard for what counts as a qualified introduction, is the structure that keeps everyone pointed at the same outcome. Ask what happens when an introduction fails a criterion you agreed. At Stourhead, we cure or replace it.
4. What you keep
Some firms keep the universe, the contact history and the relationships, and rent them back to you. Others hand everything over at the end. Over three or four cycles this is the difference between building a sourcing asset and paying for one that walks out of the door.
The types of provider you will meet
| Type | Built for | Watch for |
|---|---|---|
| Data and CRM platforms | Funds with a deal team that has the time to run outreach and wants better raw material. | The licence is the small cost. The associate hours are the large one. |
| Outreach and appointment firms | Funds that want activity under their brand and will screen replies themselves. | Meeting counts as the headline metric. Ask what happened to last year's meetings. |
| Senior-led origination boutiques | Funds with a defined thesis that want fewer, better conversations and counterparties prepared before introduction. | Lower volume by design. Make sure the mandate is written tightly enough to measure. |
| Large advisory and consulting firms | Complex carve-outs and cross-border processes at the top of the market. | Scale and cost that rarely fit a lower middle market fund. |
Where Stourhead sits
We are a senior-led origination boutique. The mandate is defined in writing, the universe is mapped from a live data layer of 2.4BN+ market data points across 1,000+ industries, outreach goes out under your brand, and every reply is read against fit, intent and timing by people with transaction experience. Counterparties that need positioning, a data room or quality of earnings support get it before the introduction, so your partners meet businesses that are ready to be looked at.
The record behind that: our team has originated $4BN+ of deal pipeline for buy-side firms, and our senior leadership brings $150BN+ of transaction experience across investment banking and private equity. Stourhead itself closed $100M+ of transactions in the last year. We keep those two figures apart on purpose. One says the people know what they are doing. The other says the firm executes.
Red flags
- A first proposal that arrives before anyone has asked about your thesis in detail.
- Results described as meetings booked, with no account of which conversations progressed.
- No written definition of a qualified introduction, or no consequence when one fails it.
- The same target available to several of the firm's clients at once.
- Nothing handed over at the end of the engagement.
Questions we are asked
Should we use more than one origination firm at once?
Only with non-overlapping mandates. Two firms approaching the same owners under your brand reads as disorganisation, and owners notice. Split by sector or geography if you split at all.
Do data platforms replace an origination partner?
They replace the research step, which is the cheapest part. The expensive part is the approach, the screening and the follow-through, which is where associate time disappears. Most funds end up using both: a platform for the raw material and a partner to turn it into conversations.
How should we measure the first 90 days?
Against the written mandate: how much of the universe was reached, how many owners replied, how many passed fit, intent and timing, and how many introductions were made. Closed deals take longer than a quarter in this market; qualified conversations do not.
What should an engagement cost?
Structures vary from flat monthly fees to success-only arrangements. We keep ours to a retainer that covers the work and a success component that follows the outcome, and we discuss figures once the mandate is defined, because the scope sets the price.
Start with the mandate
Request a conversation
Tell us which counterparties you need to reach, where deal flow comes from today and where it stalls. Where there is alignment, we schedule a working session with our leadership.
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