A snapshot of the Private Equity investment process reveals that while most PE firms have some version of structured processes for diligence, there is still substantial room for automation and increased sophistication. Many firms continue to rely on outdated tracking methods to document diligence checklists and findings. Information streams are funneled from a variety of investment professionals working on any given deal, and synthesis is impeded and complicated by resulting individualized and subjective data tracking. As a result, diligence analysis and decisions rely on siloed data and insights.

While the process of manually capturing data has historically been successful in informing valuation, downside risk, growth accelerations, etc. – it is becoming more and more evident that these methods are not enough to stay competitive. In part, a manual process has stayed in favor for so long due to lingering hesitation that broadly applying a standardized playbook will fail to meet the bespoke needs of different types of companies. For the collective industry to break away from ingrained manual processes, new tech-oriented diligence vendors will need to address these concerns head-on. Further, it’s critical that training and education take place between PE firms and digital strategy experts to identify and close the gap on which value creation levers to pull.

Tech in M&A Whitepaper

Kaiser’s study explores the evolving role of tech-oriented tools during diligence and value creation through in-depth interviews with senior leadership at private equity firms across the US ranging from the lower to the upper middle market. Check out the full report for rich insights into the rising demand for these tools, first-movers paving a roadmap for the industry, and the future outlook to stay competitive.


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