Why mergers fail #1: insufficient due diligence admin January 20, 2021

Why mergers fail #1: insufficient due diligence

Would you purchase a used vehicle without having it properly inspected by a certified mechanic?

Of course not.

While I’m loathed to describe any business as “used”, the analogy stands.

Before buying out or merging your business with another, there’s a step-by-step process of due diligence that should always be followed.

First, verify that the business has a solid foundation.

Since digital transformation is one of the top 3 reasons for M&A activities, this never has been more important than today.

Understand why the owner is selling and if the financials are sound.

This must include data on innovation capabilities.

Succeeding in the future will be dependent on those crucial skills to reevaluate the current business model and apply pivots to the ever-changing technology and customer landscape.

Tomorrow is the most important thing in life. Comes into us at midnight very clean. It's perfect when it arrives and it puts itself in our hands. It hopes we've learned something from yesterday.


Second, investigate the ROI implications.

Will a M&A with this particular brand give yours greater exposure or market value?

Is there an opportunity to address completely new markets and previously underserved customers?

M&A is an important part of your overall digital strategy.

Ensure you pick the right assets to achieve your goals.