Due Diligence

Also known as: DD, diligence, confirmatory diligence

The buyer's formal investigation of the business before closing — financial, legal, commercial, operational, and technical. Typically runs 60-120 days.

WHY IT MATTERS

Due diligence is where the buyer verifies every claim the seller has made and hunts for every risk that justifies lowering the price or adding protective terms. It's structured, adversarial, and run by specialists — accountants for financial diligence, lawyers for legal, industry experts for commercial. Every weakness diligence uncovers becomes a deduction on the buyer's running tally (the deduction list). The best founders treat diligence as pass/fail preparation work they should have done years earlier — not a surprise that happens to them.

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