Where Are U.S. Dealmakers Looking for Deals?

Geography can be a highly reliable predictor of deal activity. For example, Quartz recently learned that VCs unsurprisingly love California (aka Silicon Valley). The entrepreneur-heavy state collected $14.8 billion worth of VC backing in 2013. Massachusetts and New York came in a distant second and third, with $3.0 billion and $2.9 billion, respectively.

But mid-market M&A is much less dependent on these entrepreneurial havens. PE firms, strategics, and other financial sponsors can be much more diverse in their geographic focus. So where are these deal professionals actually pursuing deals?

The below map is a display of investor interest by state in 2013:

To build the map, we analyzed over 50,000 pursuits from the Axial Network — and in which state the pursued company was located. Each pursuit represents an investor seeking more information about a given opportunity.

While the northeast was a clear center of activity, California, Texas, and Florida were the three most active states in 2013. New York and Illinois rounded out the top 5. Correspondingly, these five states also saw the highest dealflow in 2013. At the bottom of the list were West Virginia, South Dakota, and Hawaii.

Some states — like Pennsylvania, Arizona, Utah, and Colorado — had a surprisingly high amount of pursuits. While oil & gas deals helped drive some of the activity in Pennsylvania and Utah, industry activity in the other states was more mixed. Arizona, for example, saw strong investor interest in Aerospace & Defense, Software, and Health Care opportunities.

Year to date, 2014 is mirroring 2013. In just these first few weeks, California, Florida, and Texas have already established themselves again as clear centers for investor interest. The higher degree of pursuits and interest in these states should mean closed deals in the regions before the first day of summer.