• Rohan Doctor was a managing director at Goldman Sachs when he founded Louisa AI.
• The startup uses AI to feed deal ideas and networking prompts to bankers and investors.
• Here's why he wants to bring the dealmaking playbook to startups.

Cold call after cold call, Rohan Doctor wasn't getting as far as he would've hoped.

The former Goldman Sachs managing director had emailed a list of digital strategy execs at banks and private equity firms to try to sell them on his startup, Louisa AI. But he only got a handful of replies back.

Two years since its launch, Louisa AI has secured about a dozen clients, including some of the biggest names in corporate America. They include Goldman Sachs, VC firm Insight Partners, and, more recently, one of the biggest AI chipmakers and a top consulting firm. But he didn't secure those contracts from cold outreach. He used his own startup's technology, which proactively prompts deal ideas based on people's personal and professional connections, to get in through the front door.

Now, Doctor wants to bring his dealmaking playbook to other startups ahead of an anticipated M&A boom.

"If we're able to close more deals through warm relationships this way, then other startups can, too," he said.

The near-term outlook for M&A activity has gotten brighter, with lower interest rates reducing the cost of borrowing. Wall Street execs are optimistic that Trump's return to the White House, and any business-friendly regulations that may come with it, will be a tailwind for dealmaking. Also, companies resetting their valuations could spur more transactions to close as price expectations align between buyers and sellers.

Meanwhile, in Silicon Valley, VCs and founders are hopeful about the anticipated looser environment, which could boost tech building and dealmaking. VCs, which rely on selling startups in M&A deals for many of their returns, have been dampened by the Federal Trade Commission's antitrust stance on M&A.

Louisa AI was built to suggest potential deals based on the data it's exposed to. It ingests information about who and what employees know by plugging into company CRMs, messaging platforms like Slack and Symphony, and email providers. Since spinning out of Goldman Sachs in 2023, Louisa AI has raised $5 million in seed funding. It suggests about $1 billion in deal values per quarter, Doctor said.

It also highlights mutual connections to establish a warm introduction, which can make all the difference in the multi-billion investment banking industry built on relationships. While running the bank-solutions group at Goldman Sachs, Rohan Doctor used his network to close transactions worth tens of millions of dollars. As a startup founder, it's been a different story.

"I've tried the cold outreach and just emailing," Doctor said, adding that the startup stopped doing that after it didn't yield good results. What has worked for Doctor is realizing he knows someone who knows someone.

Louisa AI scored the chipmaker contract after the AI flagged that one of Doctor's staff used to work for someone who now worked at the chip manufacturer. With the consultancy, one of Louisa AI's investors connected Doctor with the consulting firm they used to work for. He declined to name these firms due to non-disclosure agreements.

"Everything needs to be warm when it comes to big companies doing big things with other people. It has to rely on trust," he said.

• Macroeconomic signs, like lower interest rates and a new administration, point to a rise in M&A.
• Bankers anticipate more AI dealmaking to benefit data and infrastructure companies.
• Execs from Goldman Sachs, Bank of America, and Axom Partners outline their 2025 predictions.

AI offers the promise of a dealmaking gold rush in years to come, and investment bankers are looking to cash in on deals involving data and infrastructure companies selling the proverbial pickaxes and shovels.

"Everybody's rightly caught up in the lore of AI and what the industry leaders are doing regarding building out platforms, but people forget; unless you have good data management and good data integrity, you can't fully deploy any application of AI," said Neil Kell, Bank of America's chair and global head of technology, media, and telecom for equity-capital markets. "Companies that are looking to be acquisitive are focused on this," he said.

Brandon Hightower, a founder and partner at the tech-focused M&A advisory firm Axom Partners, attributes an increase in AI-themed deals to "an arms race" earlier this year around infrastructure and talent.

Those are two themes that are expected to see continued momentum, according to interviews with four AI bankers. Tech companies focusing on managing, moving, and securing data will be at the forefront of the AI M&A wave. Other "pickaxe and shovel" companies include those focusing on developer tools and resource optimization. AI dealmaking is also poised to touch non-technology sectors, like customer service, commerce, and industrials.

While there hasn't been a lot of dealmaking activity among pure-play generative AI companies, tens of billions have been spent on technology companies that are building infrastructure around AI like storage, server, cloud, and software companies, according to Scott Denne, a principal research analyst at S&P Global Market Intelligence.

In 2024, some $82 billion was spent on AI- and AI-related acquisitons, up from about $55 billion in 2023, according to data from 451 Research, an arm of S&P Global Market Intelligence. This includes purchases of companies selling AI products or products built with AI, as well as companies that sell software, hardware, and other tech to support AI development and deployments.

There are several reasons the timing may be right for companies to shop around. Lower interest rates have reduced the cost of borrowing. The gap between buyer and seller price expectations is shrinking as companies, AI ones included, reset their valuations. Election uncertainty is behind us, and president-elect Trump's pick of Andrew Ferguson to run the Federal Trade Commission is looking like a positive for Big Tech, according to Wedbush Securities.

Ferguson was tapped "at a key time in the AI arms race in which we expect the strong to get stronger as Mag 7 gets the engines started up again on M&A," Wedbush analysts wrote in a note to clients Wednesday.

All eyes on data

Because generative AI is still relatively nascent, bankers are focused on the raw ingredients that are critical to AI models'success.

"Two of the most interesting areas to watch next year will be data infrastructure, management, and analytics companies. The second is developer tools," Jung Min, the co-COO of Goldman Sachs' TMT division, told BI.

Also important is data security, according to Bank of America's Kell, which he said continues to be very relevant and vital for those companies thinking about M&A.

Eventually, the front-facing application layer will be the biggest area, he said. But "in that creation phase, the infrastructure and the developer tools, those are the things that really matter first" after the models are trained, Min said.

That's because companies are trying to figure out "how to get better quality data" and "more efficient flows of data," Axom's Hightower said.

It's something even the biggest AI companies are opening their wallets for. When Axom worked on the sale of database analystics firm Rockset to OpenAI earlier this year, the deal came down to enabling faster data retrieval and improving the data pipeline, according to Axom cofounder Alan Bressers.

The focus on data infrastructure is spotlights two big-data giants Databricks and Snowflake, which respectively have made a handful of acquisitions related to data and AI this year.

"If you have data and if you own the models, those are two key components. How do I bring those together? And if you've got Databricks and Snowflake holding a lot of enterprise data, that's a natural place for a future winner in the AI world," he said.

Optimizing the back end

A need to scale is also driving tech companies to acquire infrastructure players, Axom's Hightower said. He pointed to Nvidia's purchase of Seattle-based OctoAI, a deal that Axom worked on "so that it can scale and do certain aspects of AI workflows in a more efficient manner," he said. It's at least Nvidia's second acquisition this year with an eye toward scalability.

Earlier this year, Nvidia set out to buy Run:ai. The deal, which is still in the regulatory approval process, could help the chipmaker run compute more economically by allowing more work to be done on fewer chips.

There's also a greater focus on lowering inference costs, essentially the price of asking an AI models a question and having them generate a response. While it's well known that training LLMs can come with astronomical prices, getting them to beam back an answer might come at an even steeper price. It's something that AI adopters are learning the hard way, prompting a "very near-term thing where you can see M&A because people can say there's real dollar value from inference savings," Axom's Bressers said. He noted potential buyers interested in this part of the tech stack could be the newer generation of cloud companies, like CoreWeave or Lambda.

Some cross-sector action

While most of the AI and AI-related deals will likely be between tech companies, Goldman's Min anticipates some transactions in the industrial space.

"Companies that already automate or help automate the supply chain, a lot of those interaction are already software to software or machine to machine, so those are ripe for AI to really deploy there," he said.

Other fertile grounds for acquisition going into 2025 include customer service and customer-relationship management companies, potentially spurred by some of Salesforce's recent AI ambitions, Axom's Hightower said. This year, the CRM giant Salesforce made "a hard pivot" to AI agents with a product that lets clients build their own custom ones to interact directly with clientele. Competitors like ServiceNow, Braze, Klayvio, and HubSpot to broaden their suite of solutions and add data and data connectivity to their offerings, he said.

• An ex-Goldman Sachs banker has won a sex-discrimination case after being dismissed by the bank.
• He said he was unfairly treated when he said he was struggling to balance work and parenthood.
• A tribunal heard that one of Reeves' bosses repeatedly told him to "figure it out."

A former Goldman Sachs banker has won a sex-discrimination case after he was dismissed by the investment bank soon after returning from parental leave.

Jonathan Reeves, who was a vice president in the bank's compliance division in London, said he was unfairly dismissed shortly after returning to work in 2022.

The bank had said he was dismissed for performance reasons.

An employment tribunal ruled in Reeves' favor, saying Goldman Sachs subjected him "to sex discrimination when it alleged that he had performed worse than his peers, reduced his remuneration and dismissed" him.

Reeves told the tribunal that during a call in early 2020, he told his bosses he was finding it difficult to balance his childcare responsibilities for his first child with his job while working from home during COVID-19 lockdowns.

He told the tribunal he was repeatedly shouted at to "figure it out" by his superior Omar Beer.

The tribunal heard that another of his bosses, Tin Hsien Tan, said she had not heard this particular phrase being used but said: "I am sure it would have been more like, 'You're a grown man; you can sort this out.'"

"Mr. Beer appeared to be unwilling to acknowledge to the particular hardships or difficulties that some people, including those with very young children, might have experienced during COVID lockdowns," the judgment said.

Reeves also told the tribunal that Goldman Sachs bosses were "more empathic towards female employees in relation to childcare" than with men.

In late 2021, Reeves told his bosses that he and his wife were having a second child and that he planned to take six months of parental leave between November 2021 and May 2022. Before his leave began, Reeves said Beer told him that he was "jealous" and that he should "take advantage" of the leave.

He was dismissed soon after returning from this leave.

"There was no attempt by the Respondent to carry out any fair process before dismissing the Claimant," the tribunal said.

A spokesperson from Goldman Sachs told Business Insider: "The firm is deeply committed to supporting working parents, with hundreds of Goldman Sachs fathers having taken up our market leading 26 weeks paid parental leave since it was introduced in 2019. We are carefully reviewing the judgment and the reasoning supporting its findings."