M&A/PE IT Due Diligence Framework – Seeking Feedback
Hi all,
I’m a Consultant Enterprise Architect exploring the idea of developing a reusable set of templates and visualizations designed specifically for IT due diligence in M&A and Private Equity transactions. The goal is to create a standardized framework that would allow buy-side teams to efficiently compare:
- Potential acquisitions' IT estates side by side.
- Potential acquisitions against sector-specific reference models.
I believe this could add value in terms of consistency, speed, and insight during the due diligence process, but I’d love to get your thoughts. Specifically, I have a few questions for those of you working on buy-side M&A or Private Equity advisory:
- Are you currently using something similar to this? If so, what tools or frameworks are you using, and how do they work in practice?
- What are the 3-4 key views or data points you’d consider essential for IT due diligence during an M&A or PE process?
- If I were to develop and package this framework for wider use, would there be interest in adopting it within your teams or firms?
Looking forward to your thoughts and feedback!
TL;DR:
I’m developing reusable IT due diligence templates and visualizations for M&A and PE professionals, designed to help compare multiple acquisitions' IT estates and benchmark them against sector-specific models. Would there be interest in using this? What key views/data points are essential in your process?
Not what you want to hear, but I don't see this being very helpful. Two comments:
(i) Most SaaS investors already know the high level questions to ask and have benchmarks at their fingertips from looking at hundreds of companies
(ii) When it comes to IT/tech DD, we hire 3rd parties to help us actually fill out these templates and assess these companies (i.e., blank templates isn't helpful, it's the expertise and consultation (services) during diligence that are far more helpful) - these reports help identify diligence concerns and carry weight with lenders, co-invest, etc.
Thanks for the reply SaaSChimp - helpful to get your perspective and has triggered a few thoughts!
1. I’m thinking more broadly than SaaS —e.g., in FMCG acquisitions, presumably crucial to understand the applications in use, identify duplications, and uncover synergies with the acquiring company or its portfolio businesses.
2. Agree that templates alone will not be enough for many and the true value is in the SME input. That said, my experience is that B4 esque firms will tend to overprice and overcomplicate, often delivering non-standardized outputs. Source: Many years of working with them.
3. IT DD-aaS: I’m imagining an IT due diligence-as-a-service (DD-aaS) model where:
Would love to hear thoughts on whether this approach resonates.
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