Sell Side Due Diligence

Overview

Performing sell-side or vendor due diligence (VDD) prevents surprises which delay closing or lead to busted transactions while helping maximize a seller’s transaction value. This is especially true in today’s M&A market as due diligence efforts have become more intense and issues identified during this process can put a seller in a difficult negotiating position leading to transactions re-trading on both price and terms. An independent vendor due diligence report enables buyers and sellers to gain a better understanding of market trends and sizes, and competitive dynamics while presenting a compelling investment thesis.

Our Process

We work with private business owners, private equity, and investment banks to ensure a smooth and successful sales process. Our focus is to maximize exit values, identify and address potential issues, and provide robust forecasts and sales materials so that buyers can be confident in the information presented to them. Utilizing our industry network, we can provide potential buyers with a deep understanding of a business's competitive strengths through a comprehensive voice of the customer exercise. This process allows buyers to better understand a business and the markets it operates in, while adding credibility and objectivity to the sales process.

Forecasting

We specialize in helping businesses, investment banks, and private equity increase the accuracy of their forecasting. We can gather the data, speak to our network of subject matter experts, customers, and competitors, and build the models required to support a sales process. We develop robust, defensible forecasts for industries where there is little to no publicly available research, as well as for companies with multiple product lines with different demand drivers. Our work can help potential investors gain a better understanding of a business and its growth trends; reducing diligence and transaction times.

Due Diligence Preparation

We understand the buy side diligence process, having completed diligence on hundreds of energy and industrial companies. We help sellers and their management teams anticipate and react to buyer objections and allow them to uncover and fix valuation-reducing problems. We also help sellers develop and substantiate projections, with a focus on their ability to achieve revenues and profitability based upon year to date actuals, contracted business, existing sales pipelines and prospects. Providing credible and accurate data and being forthcoming about potential problems creates a trustworthy and transparent sales process.

Competitive Analysis / Voice of the Customer

Understanding a company’s competitive position and value proposition is a key part of the sales process. A comprehensive review of the competitive landscape including a VOC exercise provides potential buyers with a clear understanding of the key factors that impact customers' buying decisions. Due to our industry expertise we know which questions to ask to identify what issues are most important to customers and what their expectations are. We show potential buyers how companies compare against their competition to highlight a company’s strengths and help buyers understand growth prospects.

Business Plan Reviews

Confidence in a company’s business plan is a requirement for a successful transaction. Buyers need to have confidence that revenue and operating margin forecasts are achievable and that cost assumptions been developed based on achievable benchmarks. We will validate a company’s business plan, including top-line revenue and operational margins to help buyers have confidence that business plans are achievable. We also help identify key opportunities for revenue enhancements and cost reductions post-transaction and potential upside revenue sources for a business.

We work with energy & industrial companies, their owners and investors to help:

Buy and sell companies and raise capital
Perform due diligence on potential acquisitions
Prepare owners and management teams for a sale process
Improve and execute strategy