Two-Sided Direct Sourcing Standard
Verify market-moving claims with directly involved sources on both sides
- Difficulty
- Advanced
- Time to result
- ~months to results
- Steps
- 6
- Confidence
- 96%
The standard separates useful tips from publishable reporting by tracing a claim to people directly involved in the transaction. Information from traders, former executives, rivals, or peripheral advisers may initiate an investigation, but it does not independently justify publication. The reporter seeks confirmation from participants on both sides, evaluates whether either party benefits from distortion, and gives the affected organizations a chance to respond. Strong, established access to a chief executive or board chair can occasionally support publication with one principal source, but the other side must still be contacted. Attribution signals evidence strength: plural people familiar with the matter generally reflects broader confirmation, while singular attribution indicates a narrower exception. The output is a carefully scoped claim whose wording matches what the sourcing actually proves.
Origin
Alex Sherman described Bloomberg's sourcing discipline while explaining how he reported the full lifecycle of a proposed Synaptics acquisition.
Core principles
- 01Direct participants carry more weight than informed outsiders
- 02Independent confirmation reduces manipulation risk
- 03Both sides deserve an opportunity to respond
- 04Source strength determines how long a reporter can wait
- 05Accuracy matters more than matching competitors
How to run it
- 1
Start With the Tip
Record potentially valuable information regardless of whether it comes from an executive, banker, lawyer, trader, or industry contact. Treat it as a lead rather than a publishable fact.
Pro tip Maintain relationships across companies, boards, advisers, and transaction teams so one tip can be pursued through multiple channels.
Watch out Do not confuse a well-connected indirect source with a transaction participant.
- 2
Reach a Direct Participant
Confirm the claim with someone directly and intimately involved in the transaction. Establish that the source has current, firsthand knowledge.
Pro tip An existing relationship helps you judge whether the source has reliably known similar facts before.
Watch out A source's confidence does not prove direct access.
- 3
Confirm the Other Side
Seek an independently placed source representing the other party to the transaction. Compare the two accounts for agreement about status, price, timing, and seriousness.
Pro tip Ask precise questions that distinguish interest, preliminary consideration, formal talks, due diligence, and a signed agreement.
Watch out Two sources on the same side do not provide the same protection as bilateral confirmation.
- 4
Test Incentives
Consider whether either source could benefit from moving the market, attracting another bidder, changing negotiating leverage, or killing a transaction. Narrow the claim if motives or access create uncertainty.
Pro tip Use counterpart confirmation to neutralize one party's incentive to manipulate the narrative.
Watch out Anonymous sourcing can conceal motives from readers, so the reporter must investigate them.
- 5
Offer a Response Window
Contact the affected parties before publication and give them an opportunity to comment or challenge the report. Adjust the window according to competitive pressure and source strength.
Pro tip A strong principal source can justify a short response period when competitors are pursuing the same news.
Watch out Silence is not independent confirmation.
- 6
Match Language to Evidence
Use attribution and headline wording that accurately reflect the number of sources and the maturity of the transaction. Publish only the strongest claim that the evidence supports.
Pro tip Distinguish active talks from past talks, informal consideration, or a dead process.
Watch out Overstating transaction maturity can create an unjustified market reaction.
In the wild
Sherman reported several stages of a Chinese conglomerate's interest in Synaptics: initial interest, due diligence, a reduced price, continuing talks, and the deal's eventual death. Other outlets did not consistently match the reporting, but he trusted it because his sources were directly involved and represented both sides.
→ Bloomberg documented the transaction's lifecycle without relying on market chatter or competitor validation.
When a trusted CEO or board chair provides firsthand information and competitors are chasing the same story, a reporter may proceed with singular attribution after contacting the other party and allowing a short response window.
→ The report can move quickly while preserving a minimum right of response.
Common mistakes
Publishing an Indirect Consensus
Several traders, former executives, or rival bankers can repeat the same rumor without possessing firsthand knowledge. Volume does not convert secondhand information into direct confirmation.
Confirming Twice on One Side
Multiple sources aligned with one participant may share the same incentives or original information. Bilateral confirmation is materially stronger.
Writing Beyond the Evidence
Calling preliminary consideration formal talks can trigger a market response that the underlying sourcing does not justify.
Is it for you?
Best for
Reporters, analysts, and investigators handling consequential claims that require confidential sourcing.
Not ideal for
Routine public announcements that can be verified directly through filings or attributable statements.
From the transcript
“none of those sources are good enough for us to publish something on because they're not direct.”
“we have to get both sides sourcing in order to run a story to be comfortable with the fact that it's right.”
From the episode
Inside the M&A Press with Bloomberg's Alex Sherman
Alex Sherman