Technology Due Diligence is Much More Than a Checklist

Can technology impact the pre-close valuation of your target company?  Or the ability to create value post-close? At Sabio, the answer to both questions is a resounding YES. 

Answering these types of questions is exactly what we specialize in.

We believe that technology due diligence should be part of your overall diligence process – especially in the middle market.  This applies to every company in every industry – not just high-tech companies that happen to sell technology.

Technology diligence will tell you how supportive the target company’s technology will be to your deal thesis and how much risk you may be taking on.

Technology due diligence is much more than a checklist – it helps you answer key questions and informs your investment decisioning process.  For example, these are some of the questions our diligence process helps you answer when evaluating a target company:

• Will the company’s technology enable or inhibit future value creation?

• Does the company spend the right amount on technology?

• Where does the company spend on technology and is it aligned to strategic objectives?

• How much technical debt has the company accumulated and will that present significant risk?

• Will you need to incur significant post-close spend on technology in order to mitigate key risks?  Can that spend be funded from operations alone?

• Does the company have solid technology leadership?  Is the team effective and productive?

We are now in a world where every company is subject to the forces of digital disruption and the answers to these questions may significantly impact your investments.  These are but a few of the many questions we help you answer.