Why A Technical Due Diligence Is Important?

 

Today, every company is a technology company in one form or another. Market leaders build or leverage technology intentionally to acquire competitive advantages. 

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There are no longer car companies, banks, or healthcare providers. There are tech-enabled companies that produce autonomous vehicles, digital banking services, and technologies that help diagnose and treat patients.

 

Whether technology is the primary business or the backbone of a tech-enabled company, it has a significant impact on the health of the company, profitability, and ability to compete. 

 

As an acquirer, market size and TAM may be one side of the coin, but the other side that is provided by technical due diligence will determine the ability to seize, grow, and profit within that market.
 

Technical Due Diligence Capabilities

 

At RingStone, we take a pragmatic and strategic 360 holistic approach to Technical Due Diligence. This allows us to be uniquely positioned to uncover risks but also uncover hidden concerns and optimizations opportunities while keeping the business in mind.

Our technical due diligence is data-driven, with quantifiable benchmarks that feed into the value creation cycle for maximum benefits. This allows the acquirer to compare apples to apples and empowers them to make business decisions quickly and clearly.
 

Strategically, we seek to fully understand the investment thesis and start with the end in mind. This helps us determine the suitability of end-to-end technology and its ability to evolve to accommodate the business strategy and technology shifts.
 

The end-to-end diligence comprises business and technology strategy, roadmap, software architecture, code health, team capabilities, deployment setup, infrastructure, security, and leadership.

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What Makes Us Different?

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Deep technical experience and years of execution experience working with investors and companies, and hands-on with teams globally, provide us with a competitive edge.

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Our approach combines humans, machines, and tools. Our team comprises senior technical experts such as CTOs with solid business acumen complimented by proprietary software, industry, and best practices data to help us to deliver the best value for our clients with a pragmatic focus on practical risk mitigation and value creation.

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Diligence packages are tailored based on the target situation, stage, size, revenue, maturity, and, more importantly, the investment strategy and goals. We help you decide which package is best for your situation.

Whether it is a stealth mode that requires an outside-in approach, a competitive deal with limited access and a compressed timeline, or standard due diligence, we offer multiple products ranging from outside-in to full diligence to accommodate your needs.

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We move fast and accommodate fast-moving deals.

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Software Technical Due Diligence Core Offerings

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Outside-In Stealth - Technical Due Diligence (~ 1-2 weeks)

Outside-in approach to validate the thesis, confirm interest, and answer specific questions

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When to Consider?

• You have an initial interest in a company and exploring

• You are in discussion with a company, but no commitments on either side

• You need a high-level validation to limit future effort and spend

• You are interested in a minority interest and need a high-level validation

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Standard Full-Technical Due Diligence (~ 3 weeks)

Full in-depth diligence technical due diligence with full risks and opportunities backlog, industry benchmarks, best practices benchmarks, costs optimization opportunities, and a value creation roadmap

 

When to Consider?

• Do you have an LOI in place or soon to be?

• You are in exclusivity or have a healthy access

• You prefer in-depth risks, opportunities, and value-creation options

• You would like complete documentation of the functional areas in depth

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Summary Report - Technical Due Diligence (~ 2 weeks)

The scope is identical to the Standard Full report without a lighter touch on the amount of supporting documentation.

 

Full in-depth diligence technical due diligence with full risks and opportunities backlog, industry benchmarks, best practices benchmarks, costs optimization opportunities, and a value creation roadmap

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When to Consider?

• Do you have an LOI in place or soon to be?

• You are in exclusivity or have a healthy access

• You prefer in-depth risks, opportunities, and value-creation options​

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Redflag - Technical Due Diligence (~ 1-2 weeks)

High-level red flag thesis validation with top risks

 

When to Consider?

• Do you have an LOI in place or soon to be?

• You are in exclusivity or have some or a healthy access

• You have a very limited time and need a quick red flag

 

Competitive - Technical Due Diligence (~ 3-4 weeks)

Combined standard and stealth diligence. Full in-depth technical due diligence with full risks and opportunities backlog, industry benchmarks, best practices benchmarks, cost optimization opportunities, and a value creation roadmap with extended time to accommodate access challenges. 

 

When to Consider?

• You are in discussion with a private or public company

• You are part of a competitive process with other bidders

• You have limited access with some management access

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