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The Interview with Hein Stoops, a CDI Global Member Partner

Recently Jeff Schmidt, CDI Global Executive Managing Director and Chief Executive Officer, spoke with Hein Stoops, a CDI Global Member Partner located in the Netherlands. Hein is CDI Global’s new Chief Technology Officer and member of the CDI Management Committee.

Jeff Schmidt:
We welcome today Hein Stoops, CDI’s newly-elected Chief Technology Officer. Hein is a partner in our CDI Global office in the Netherlands.

Hein, tell us about your personal background and how you joined Hogenhouck?

Hein Stoops:
Hi Jeff, it’s a pleasure to talk with you today. I grew up in the east of the Netherlands in a small town and then I moved to Amsterdam when I turned 18. I am 43 years old now. I studied economics at the Free University in Amsterdam and specialized in corporate finance. A little side note, I spent a summer near Chicago where I went to Notre Dame for an MBA exchange program, which was very interesting and high end. Unfortunately, only for three months.

I started my career in treasury consultancy. But I enjoyed corporate finance and decide to focus on M & A. That's why I switched to an M & A boutique in the Netherlands and worked there for several years. Then, I transitioned to private equity. I was an investor for three years in private equity as well in Brussels for a family office. I joined CDI, the Netherlands, in 2008 as a partner. So, up to now, I have 20 years of experience mostly in mid-market M & A.

Jeff:
Who are some clients you've worked with at Hogenhouck.

Hein:
Our practice in the Netherlands, almost all 90% of our assignments, involves privately – family-owned companies. Typically, we have a sell-side mandate in the mid-market, M & A. Mid-market here is a bit different than in the US. Our sweet spot is transactions valued between $10 and $50 million, sometimes higher. What we are best known for helping private owners with no connection to the professional M & A world. We help them sell the business to a professional private equity company or strategic company. If you look at our position, 60 to 70% of our transactions are TMT related. In the mid-market, we are now the leader in TMT advisory, which in these times is a good place to be!

Jeff:
You have multiple roles in the Netherlands. In addition to the new responsibilities as our chief technology officer, what roles do you play in the local firm?

Hein:
My main role is execution of transactions. We divided the Dutch team between origination and deal execution. I'm focused on deal execution. That means the moment the relationship moves to a transaction, I’m responsible for the team to make sure this transaction gets done in the end. In addition, since we've been part of CDI for four or five years now, I've done a lot of work for CDI because I have relevant prior experience from a different network. Now I am a member of the Management Committee.

Jeff:
The business model for CDI Netherlands is very unique and compelling. Please talk a little bit about that. You mentioned that the team is divided up according to origination and execution. I know that one of the partners, Rik Sticklebrook has a focused role in origination.

Hein:
Yes, that’s correct. I think one of the biggest mistakes that you can make in our profession is solely working on a transaction. Everybody knows the environment when you are working on a deal or closing the transaction, how busy you are. And then the day after you're going to think about everything you should have been doing over last couple of months, among which are contacting your relationships see how they are doing and what's going on to help them in their process towards a transaction. That’s why we decided to split roles with a dedicated team to keep in touch with our relations and the markets to know the trends, so we're always in time to step in when needed.

Jeff:
In your new role as Chief Technology Officer, that’s what needs happen.

To the extent that you feel comfortable, do you have some initial thoughts on how CDI Global under your guidance can strengthen its organizational integration, and maybe improve its internal and external communications with the technology?

Hein:
The world is changing and it's going to impact the M & A business. The focus points are going to be different. Whereas 30 years ago, you had to pick up the phone to get access to a company, to build a relationship. It becomes more and more data driven. I think it is going to make part of our business more hygiene factor, whereas better and more available data is easier to analyze. Access to data and analysis are not an USP anymore. But the ultimate factor is the quality you deliver in terms of the right relationship, understanding your client’s situation and access/insight in creative and suitable solutions for strategic M&A related challenges. So, we need to make sure we become effective and understand how to use technology like chat GPT, Microsoft Copilots and AI platforms, to make our network more effective and to help in the end, the partners to be better dealmakers.

Jeff:
You've mentioned a couple of significant new developments. How can a firm like CDI Global stay current with all the changes that are happening so quickly. Given the importance of information technology to remain competitive, how can we stay on top of these important trends?

Hein:
I think the most important factor is to be open to these developments. You need to see how you can embed the best technology. If you are too conservative, you're going to be a step behind. As mentioned above, I think the USP is going to become a standard on deal making aspects. Today, soft skills dominate, including personal relationships, a local presence with understanding of local culture, understanding of local negotiation tactics. USP is going to become as important as soft skills, and we are going to need it and be open to it. Also, we will need to invest in it. It's going to cost advisory firms to keep you up with technology in order to remain competitive. Having said that, our M & A world is quite conservative. There are not many parties using this these assets at present. This could be an opportunity for CDI if we can move forward better and faster than competitors.

Jeff:
We’ve seen growing experimentation with brokerage platforms. There are public platforms from intermediary start-ups. Within CDI Global, our Swiss team piloted an internally-developed platform. What is your view on these platforms? Are they a threat or are they an opportunity to the traditional business model for M & A advisors?

Hein:
At the moment, it’s a bit unclear. I don't think they are really a threat. Rather, they are an opportunity. But for that to happen, you need to learn how to work with them. It's really hard to standardize these platforms. Just a simple example: it's hard to understand what the real USB of a business is. You can't explain something like that in five sentences. So, the challenge is to transform these platforms in an attractive database and then to actually use them. We have the opportunity to learn how to use these platforms in a way that makes us more effective as advisors. But we are not there at the moment. We need to find ways to make those platforms intelligent so that they provide the correct information for dealmakers.

Jeff:
Do you see opportunity for increased use of video technologies in marketing, providing advisory services, communicating, and establishing thought leadership in an industry sector or on an issue using multiple platforms like LinkedIn, YouTube, and so on. Do you have a view on that aspect of emerging technology?

Hein:
In marketing, definitely. In the end, you want to stay in touch with and communicate regularly with your important relationships and clients. Where are they nowadays? They're online. They're on Indeed and LinkedIn. More and more, on YouTube, and on other social platforms. So that's where you need to be. That's also quite challenging from a marketing perspective because most people who visit LinkedIn are on message for five seconds. You need to communicate your ideas in that short time. That's challenging to say the least. There's no doubt that tech in all forms is important for effective marketing and deal making. All technologies have a role in facilitating interactions and making you more efficient. Still, technology cannot do everything. For example, with negotiations, you need to be in the room with the other party. At the end of the day, for certain aspects of deal making, you can't get things done effectively from a video or email.

Jeff:
In marketing services, it's important as an advisor to build a level of trust, credibility, and rapport with a prospect for a client. It's hard to do that via video alone.

Hein:
It trends with what we see in M & A. For example, the market for digital agency is growing quickly as a sign of increasing online marketing. But on the other hand, there's not many M & A firms that already using that approach. Which is a bit strange!

Jeff:
It's an opportunity for the firm that figures it out.

Hein:
Exactly. That's exactly right.

Jeff:
Hein, thank you for this interview. We're looking forward to the contributions and the vision that you have for CDI Global and our technology function. You will take us to another level of capability. So, thank you again for your time today.

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The Interview with Hein Stoops, a CDI Global Member Partner