The Case For and Against Using AI in the M&A Process
In this article, we look at a successful use of AI in M&A and how it can be used to streamline the process while also looking at the potential dangers associated with this new technology.
Shunsaku Sagami is a 32-year-old Japanese entrepreneur who has become a billionaire by using artificial intelligence to make mergers and acquisitions. His company, M&A Research Institute Holdings, uses a proprietary database and AI algorithms to match potential buyers and sellers of businesses.
Sagami saw the potential of AI for M&A while working as an investment banker. He was frustrated by the slow and inefficient process of traditional M&A, which often involved months of manual research and negotiation. He believed that AI could automate many of these tasks, making the process faster, cheaper, and more efficient.
“Sagami’s success is a testament to the power of AI to transform traditional industries”
In 2018, Sagami founded M&A Research Institute Holdings. The company’s AI platform uses a variety of data sources to create a comprehensive profile of each business, including financial information, management team, and competitive landscape. The platform also uses machine learning algorithms to identify potential buyers and sellers who are a good match for each other.
Since its launch, M&A Research Institute Holdings has helped to facilitate hundreds of mergers and acquisitions. The company’s AI platform has been credited with making the M&A process faster, cheaper, and more efficient. As a result, Sagami has become a billionaire and his company is one of the leading M&A firms in Japan.
Sagami’s success is a testament to the power of AI to transform traditional industries. AI is already having a major impact on the M&A industry, and it is likely to continue to play an increasingly important role in the years to come.
Benefits of using AI for M&A:
Speed: AI can automate many of the tasks involved in M&A, such as research and due diligence. This can significantly speed up the process, which can be a major advantage for businesses that are looking to make a quick deal.
Cost: AI can also help to reduce the cost of M&A. By automating tasks, AI can free up human resources to focus on more strategic aspects of the deal. This can save businesses a significant amount of money.
Efficiency: AI can help to improve the efficiency of M&A by streamlining the process and reducing the risk of errors. This can lead to better deals for both buyers and sellers.
As AI continues to develop, it is likely to have an even greater impact on the M&A industry. In the future, AI could be used to automate even more tasks, such as negotiation and closing. This could lead to even faster, cheaper, and more efficient M&A deals.
Although this has been a very successful approach to date, there also some potential dangers for using AI in the M&A Process, here are some of the dangers:
- Biased decisions: This is one of the biggest dangers as AI can be used to make biased decisions. AI algorithms are trained on data; if that data is biased, the algorithm will also be biased. This can lead to companies making decisions that are not in their best interests. For example, an AI algorithm that is trained on data from the past may be biased towards making decisions that have worked in the past, even if those decisions are no longer the best course of action.
- Job Losses: Another danger of AI for M&A is that it can lead to job losses. As AI automates more and more tasks, fewer people will be needed to do those tasks. This could lead to job losses in the M&A industry and other industries that are affected by M&A.
- Manipulate information and people: Finally, AI can also be used to manipulate people. AI algorithms can be used to create fake news and propaganda that can be used to influence people’s opinions and decisions. This could be used to manipulate people into supporting or opposing M&A deals.