Not too long ago, M&A due diligence meant lawyers digging through piles of paper to assess the activities of a seller. Modern technology gives lawyers and other dealmakers to conduct their analysis with speed and efficiency previously impossible.
Tech Due Diligence
In the age of cybersecurity risks and GDPR regulations, executing due diligence on technology is essential to ensure the health of a business. A thorough due diligence process in tech involves evaluating a software business’s security and ensuring that they’re in compliance with GDPR. It also examines the quality and scope of the company’s portfolio of intellectual property, and identifying any potential issues.
When acquiring a company when you are buying a business, it is essential to know the financial structure of the company and ensure that all parties share the same expectations. A thorough due diligence exercise can reveal issues like overstated net operating losses, unreported tax liabilities, non-filing exposures, taxes on payroll as well as sales and use tax and property taxes.
During the due diligence process, it’s essential to have a plan to collect and share all necessary information. The use of playbooks that can be utilized by teams throughout the process can help keep everyone on the same page and provides consistency. Loopio’s team workspace and collaboration features are perfect for this purpose, assisting teams to stay focused on their responsibilities and avoid getting distracted by other tasks.