The M&A Risk Thermometer

Plus: 5 Situations Where Earnouts Make Sense

Author

Derek Avdul
March 10, 2026

Quick M&A Insights, Infographics, & Interesting Info Every Week!

Welcome to the M&A Mindset!

This Week:
This week we’re looking at two areas that quietly influence how deals get structured and negotiated.

First, a visual breakdown of common deal risks — and how different issues can move a transaction from routine to high-risk faster than many sellers expect.

Then, we explore when earnouts actually make sense. While often viewed skeptically by sellers, in the right situations they can help bridge valuation gaps and get deals across the finish line.

Plus, as always: curated articles, practical learning resources, M&A merch, and something to lighten things up at the end.

Let’s dive in.
- Derek

INTERESTING INFOGRAPHIC

Each week, I feature a visually engaging infographic that distills a key M&A subject area into an easy-to-digest format. These quick reference guides aim to deliver clarity, insight, and practical understanding at a glance.

The M&A Risk Thermometer

M&A TOPIC BRIEFING

In this section, I provide a clear, concise overview of a specific topic, trend, or concept within the realm of M&A. The goal is to educate, inform, and spark discussions on relevant subjects, helping you deepen your knowledge and better navigate the complexities of M&A more confidently.

5 Situations Where Earnouts Make Sense

How Jennifer Anniston’s LolaVie brand grew sales 40% with CTV ads

The DTC beauty category is crowded. To break through, Jennifer Anniston’s brand LolaVie, worked with Roku Ads Manager to easily set up, test, and optimize CTV ad creatives. The campaign helped drive a big lift in sales and customer growth, helping LolaVie break through in the crowded beauty category.

ARTICLES OF INTEREST

  • Gen AI in M&A: From Theory to Practice - Generative AI is increasingly transforming M&A by helping teams identify targets, accelerate due diligence, and plan integrations—cutting costs by roughly 20% and speeding deal cycles by up to 30–50% for early adopters.

  • Is AI the Magic Sauce That Will Unlock Value in Media Mega-Mergers? - The article explores how AI could help media giants extract more value from large mergers by improving content production, monetization, and analysis of massive media libraries.

  • Spellbooks Gets $40M Debt for Legal AI M&A - Goal is to pursue acquisitions as consolidation accelerates in the legal AI market, where many smaller startups are seeking exits amid rising competition and funding pressure.

  • DiligenceSquared Raises $5M to Automate M&A Research with AI - Company focused on creating AI voice agents that automate key parts of M&A due diligence—such as expert interviews and market research—aiming to dramatically cut the time and costs typically associated with deal research.

  • DealFlowAgent Raises $750k to Automate Small Business M&A - AI startup focused on building an AI-powered “investment bank” for SME deals. They combine human advisors with an AI agent that identifies buyers, manages data rooms, and accelerates transactions in a market expected to see trillions in boomer business exits.

SPREADSHEET TIPS & TRICKS

Master Financial Modeling from Elite Practitioners

6 jam-packed courses with countless cases and 30+ exercises to help you learn financial modeling. Each course is designed to guide you step-by-step in your journey to develop elite modeling skills. Click Here!

GOOD READS THIS WEEK

FROM THE BENCHMARK BLOG

My firm, Benchmark International, a global, award-winning sell-side M&A company, has a ton of great resources that help anyone considering selling or buying a business get more educated on all aspects of the process. Below is just one helpful article. Check out Benchmark International for many more useful articles, news, and resources.

FRIENDS OF THE M&A MINDSET

From time to time, we’ll highlight newsletters and podcasts we genuinely read, listen to, and respect across M&A, PE, and the broader deal ecosystem.
No paid placements. No mass promotions. Just thoughtful, high-quality content that complements the M&A Mindset.

Here’s a few newsletters that I’ve signed up for and found interesting. Thought you might enjoy checking them out.

Have something to suggest that we should know about? Reach out. 

LIGHTEN UP!

In the fast-paced world of M&A, we can sometimes take things (and ourselves) a bit too seriously, so it’s good to remember to enjoy a lighter moment now and then.

Everything We Know About How Wall Street's Biggest Firms, from JPMorgan to Blackstone, Are Adopting AI

M&A MERCH

Here’s a find for us finance folks to grab some M&A-inspired swag. Stuff for those of us that speak fluent EBITDA. If you find others that have great deal-themed gear, send them this way so we can let everyone know. Enjoy!

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Stay Curious,
Derek Avdul

New to the M&A Mindset? This weekly newsletter cuts through the noise with concise insights, infographics, and resources on middle-market M&A—trusted by 5,000+ deal professionals, business owners, and investors. Whether you're planning a transaction, building your expertise, or just fascinated by deals, you'll find something valuable here every week.

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