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By the time you're in a deal, it's too late to fix the things diligence will find.We get it. You're running the business today and a sale feels like a someday problem. But the owners who get the best outcomes start preparing one to three years out, not one to three months out.
It's time to see your business the way a buyer will, and fix what's fixable before it costs you at the negotiating table.
Our team has represented hundreds of buyers and sellers on M&A transactions. Our experience spans transactions ranging from $5M in total enterprise value to $300M in enterprise value. From an industry perspective we have deep roots in healthcare / life sciences / SaaS / consumer / business services / real estate and distribution wholesale. We support business owners and executive management teams on
Our team brings 20+ years preparing business owners for their first institutional round of capital. We understand the unique challenges family and founder owned businesses face. Because we bring experience representing private equity funds and family offices on buy-side due diligence we are in a unique possession to enable business owners to plan their sell-side strategy at their pace. We partner with investment banks to help tell the story behind the numbers. Our sell-side engagement starts with a valuation report to help get business owners comfortable with what range they can expect in terms of selling price. Next, we prepare a Quality of Earnings (QoE) written report and data book. This report is the same due diligence report the buy-side will generate. Getting a sell-side QoE will help you uncover gaps in your process and prepare you for the buy-sides questions.
Once the ink on the Letter of Intent (LOI) is dry it is all systems go on the buy-side. We are able to deploy resources quickly to match short due diligence timeline allowed before exclusivity lapses. In our process we provide an overall review of the strength of the accounting and finance teams, non-compliance with GAAP, potential red flags from a customer and vendor concentration risk perspective as well as identify solutions to improve the financial reporting process post transaction close. All of our buy-side engagements come with a written QoE report and data book, as well as recommendations on process improvements and opportunities to enhance value creation. Our buy-side financial due diligence is focused on confirming the financial performance of the business as presented. Our written Quality of Earnings (QoE) report includes a proof of cash, analysis of networking capital, variance analysis of all items on the profit & loss statement as well as the balance sheet, customer analysis for risk assessment and vendor analysis for risk assessment. During our process we also assess the overall strength of the finance organization and highlight opportunities for value creation in the financial reporting process. Each engagement includes a written report and supporting data book. Our engagements can be tailored down in scope and price to provide value to your overall due diligence process.
Tax exposures can quietly erode deal value, and buyers are often the ones left holding them after closing. Our buy-side tax due diligence looks at a target's federal, state, and local income tax positions, entity structure, and compliance history. We pay particular attention to sales and use tax and payroll tax, where unregistered nexus, missing exemption certificates, and worker misclassification often create unrecorded liabilities. Buyers in the lower middle market use our findings to quantify exposure, negotiate price, secure indemnities and escrows, and avoid inheriting surprises.
As soon as the LOI is signed the time clock starts ticking for private equity funds to return capital to their limited partners (LP)s. We understand the pressure fund managers face to delivery above market returns to their limited partners. Time is the enemy of all deals – our team moves at the speed required to ensure due diligence is completed before exclusivity lapses. Our rigorous internal control over deliverables guarantees quality in our work and identifies blind spots as well as low-hanging fruit for EBITDA expansion.
Lower middle market finance organizations suffer from imposter syndrome. Too often accounting managers are masquerading as global controllers or even CFOs. Our team will conduct a review of the financial reporting process and assess the need for FP&A analysts. The first 100 days post-close are crucial to ensure accurate and timely financial reporting supports the thesis developed by private equity analyst deal teams. We will work to implement systems to deliver GAAP basis financial statements within 10 days of the close business. This will provide your new CFO reliable financial reporting from day one. Our engagements are flexible with the ability to start and stop on demand.
Once the dust settles and the deal is closed its time to integrate the asset into your portfolio. A purchase price allocation needs to be conducted to assign value to the underlying assets and to maximize the amortization of the goodwill deduction for tax purposes. A valuation is required to be defensible under IRS audit. Our team will conduct a valuation and provide journal entries to get the new acquisition ready for inclusion in consolidated financial statements.
A growing business can quickly outgrow entry-level accounting software. A poorly planned system change can disrupt reporting just when lenders, investors, or buyers are paying the closest attention. We help lower middle market companies choose, design, and implement ERP systems that fit how they actually operate. Our work covers requirements gathering, chart of accounts and process redesign, data migration, and post-go-live support. The result is cleaner books, a faster close, and financial reporting that holds up under diligence.
Our team of experts brings decades of experience cleaning up historical financial statements and creating lead sheets for auditors thus saving your portfolio companies on expensive audit fees thousands of dollars in audit fees.
Depending on the size and industry of your new acquisition an outsourced controller function can be massive cost reduction tool. Our team has experience providing GAAP basis financials for companies ranging in revenues of $5M-$25M. We also have the ability to augment parts of the accounting cycle whether it’s an AR/AP clerk, budgeting help or providing month-end close oversight.
