• Chelsea Wilkinson

Data due diligence is the next step on the digitalisation value chain

“Due diligence is due for an upgrade,” Douglas Laney argued in a 2020 Forbes article.


I agree.


Risk and value are wider and more complex than the traditional definers of due diligence. The stalwarts of financial, taxation, legal and commercial due diligence (CDD) – all of which are needed – must be supplemented with more specialist assessments of company value and potential.

Hence, I was delighted to see CDD giant Bain & Company's recent acquisition of Tech Economy – a specialist consultancy which helps investors assess the underlying technology of the businesses they are looking to acquire.


Hugh MacArthur, Bain’s global head of PE, said of their rationale: It has become critical for private equity investors to understand the technological infrastructure and processes of any digitally enabled business.


Again, I couldn’t agree more, Hugh!


Technology and digital DDs are vital to progressive investors seeking value insights, as I’m sure my colleagues at onefourzero, CG Consultancy (UK) Limited & Palladium Digital (to name a few) concur.


Yet, I would add that Data Due Diligence is then the next natural step along the digitalisation value chain.


After all, data and analytics assets can materially improve company decision making, optimise/automate operations and – in some instances – generate new revenue streams.


Plus, in a world where over 80% of corporate value comprises intangibles, it’s inevitable that a significant portion of this can be attributed to a business’s data.


So, why are data assets still being overlooked in due diligence?


And what other specialist areas should be included? I’m sure Lizzie Wills would add Policy DD?


What else?


https://www.bain.com/about/media-center/press-releases/2021/bain-acquires-tech-economy/


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Originally published on LinkedIn:

https://www.linkedin.com/posts/chelsea-wilkinson-35527079_bain-company-acquires-tech-economy-to-enhance-activity-6813359423768018944-LhHd