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Front-End Due Dilligence

Investor and Transactional Services

Front-End Due Dilligence

  • Finance & Accounting
  • Investor & Transaction Services
  • Front-End Due Dilligence

Avoid last-minute surprises that could derail a transaction.

For financial due diligence, CFOs, CPAs, and accountants gather and analyze the quality and health of a potential target’s financial position, including earnings, working capital requirements, and free cash flow. The due diligence should research whether the company has been involved in any lawsuit or corporate scandal. Recorded red flags should be considered by investors before doing any business with a particular company. Investors and advisors can also step up by checking and verifying the credentials and background of the company’s management team.

Leverage the TechCXO team to help in solving problems and driving solutions.

Schedule a 15-minute call
Email us for more info

TechCXO Front-End Due Diligence Services

TechCXO provides full buy-side and sell-side support, including Readiness (e.g. Cash to GAAP Conversions, Revenue Recognition and Restatements, Departmental Margins, Developing Forecasts); Due Diligence; Integration; Quality of Earnings remediations, and Working Capital issues and fixes.

Our front-end due diligence support includes:

  • Financial Due Diligence;
  • Core Analysis / Adjustments;
  • Quality of Earnings;
  • Revenue Recognition;
  • Cash Proof/Free Cash Flow;
  • Cash Free, Debt Free Issues;
  • Working Capital PEG;
  • Contract Reviews and more.
  • Readiness

  • Due Diligence

  • Integration

  • Quality of Earnings Issues

  • Working Capital Issues

Readiness

  • Strategy & Structuring Support
  • Structured Diagnostic Process
  • Financial Assessment of Target Company (Buy-side)
  • Confidential Memo & Pitch Review and Input
  • Valuation Analysis – Business Perspective
  • Negotiation Support
  • Data Room & PBC Preparation and Organization
  • Cash to GAAP Conversions
  • Revenue Recognition and Restatements
  • Departmental Margins
  • Developing Forecasts

Due Diligence

  • Financial Due Diligence
  • Core Analysis / Adjustments:
  • Quality of Earnings
  • Revenue Recognition
  • Cash Proof/Free Cash Flow
  • Cash Free, Debt Free Issues
  • Working Capital PEG
  • Contract Reviews
  • Technical & Operational Due Diligence
  • Product Roadmap Review and Rationalization
  • Sales and Customer Diligence
  • Analysis of Financial Forecasts
  • Develop Post Acquisition Integration Plan
  • Agreed Upon Procedures

Integration

  • Day 1 and Day 100 Plans
  • Interim Management/Hands-on Performance Improvement
  • Closing vs. Opening Balance SheetDevelopment
  • Purchase Price Allocations and Booking
  • Customer, Channel and Product Strategies
  • Finance and Admin Transition
  • Post-closing Purchase Price Adjustments

Quality of Earnings Issues

  • Determine, Normalized, Sustainable, Run-Rate
  • Non-Recurring Items:

- Gains/Losses on Assets Sales

- Large, One-time Sales

- Transaction Costs

- Large Legal Fees or Settlements

- Start-up/Shut-down Costs

- Turnaround Costs/Severances

  • Normalizing/Run-rate Items:

- Investigate Spikes + and -

- Pricing Changes/Staggered Pricing

- Raises or Anticipated New Hires

- Renegotiated Contract Terms

  • Non-Cash Items:

- FAS 123R Expense

- Allowances / Warrant Res.

Working Capital Issues

  • Negotiating the LOI & SPA Terms
  • Excluded Assets and Liabilities
    - Cash?
    - Aged A/R?
    - Employee Notes?
    - Deferred Revenue?
    - Lines of Credit?
  • Treatment of Identified EBITDA Adjustments
  • Quality of the GAAP applied in Monthly Financials
  • Seasonality Issues
  • Deferred Revenue
  • What is the True Monetary Performance Obligation?
    - Customer Deposit vs. Deferred Revenue
    Modelling Working Capital PEG

What to Expect

Expertise

TechCXO Finance partners have been involved in financial planning, investment, capital raising and many transactions, both from the sell-side and buy-side. We understand what is important in forecasting and modeling. You can be sure you will be getting expert and actionable advice.

Speed & Capacity

There is little to no learning curve when engaging a TechCXO partner. Each financial pro has led multiple organizations as a C-sute executive and moves quickly to provide unique insights.

Plan of Action

A team of trusted experts will pull together a clear plan of action – driving milestones, identifying risks, and establishing strong communication plans. This takes the onus off of the buy-side team to drive a swift plan of action.

Impact

Clear Analysis and Adjustments

Full buy-side and sell-side support

Thorough processes and procedures

Why choose TechCXO as your Front-End Diligence Partner?

TechCXO helped pioneer the on demand executive model in 2003 from a simple belief: high-potential companies can benefit from proven part-time and interim executives who they otherwise may not be able to access due to cost, availability, or they didn’t yet need them full time.

We have grown top-line revenue in our own firm every year since our inception due to reputation, referrals, and outstanding work.

We’ve helped more than 7,000 companies -- including billions in capital raises, exits, and transactions -- to date, from startups to Global 1000 companies.

Schedule a 15-minute call today

Our Team

Eric-Froistad-400x400

Eric Froistad

Principal

Related services

  • Outsouced Operating Partner Capabilities
  • Workouts, Turnarounds and Distress
  • Post-Deal Integration and Assimilation
  • Transaction Assistance

Insights

Essential Tech Due Diligence Skills: Reasons to Avoid the ‘We’ve Got a Guy’ Shortcut

09/17/2024
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Technical Due Diligence: Benefits, Process, & How-to Checklist

09/10/2024
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techcxo-inc-5000

TechCXO Returns to Inc 5000 List

08/28/2024
Read More

Questions?
Call Us or Email

If you’ve never outsourced or used executives on demand before, you’re sure to have a lot of questions. Don’t worry, we’re more than happy to answer them all.

And we know everything there is to know about this unique model. Schedule a call with us or send an email now.

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