M&A diligence was an approach where lawyers would sort through piles of documents to evaluate the performance and operations of the seller. While there’s still a lot of work to be completed in the diligence process modern tools allow lawyers and other dealmakers to conduct their analysis at rates and efficiency that were previously unattainable today.
Tech Due Diligence
In this day and age of cybersecurity risks and GDPR regulations performing due diligence on tech is vital to the success of a company. A proper tech due diligence process involves assessing a software company’s security and ensuring that they are fully compliant. It also includes analyzing the strengths of the company’s intellectual property portfolio and identify any potential infringement issues.
During the acquisition it is crucial to know the financial structure of a business and ensure that all parties have similar expectations. A thorough due diligence process can uncover issues such as overstated net operating losses, not reported tax liabilities, non-filing exposures, tax on payroll sales and use taxes and property taxes.
During the due-diligence process it is crucial to have a plan for gathering and sharing all relevant information. A set of playbooks that can be utilized throughout the process by teams helps keep everyone on the right path and ensures that everyone is on the same page. Loopio’s team workspaces and collaboration features help teams stay focused on their responsibilities, and not get distracted by other tasks.