How Expert Surveys Help Leverage the Due Diligence Process

  • Pavan Kalyanmath

<p>Large corporations expand and diversify their operations through strategic mergers and acquisitions, and private equity due diligence is a significant component of the M&amp;A journey. These transactions are usually very high-stakes and time-sensitive, with specific insights from expert surveys playing a pivotal role in the decision-making process.</p><p><img src=""></p><p style="text-align: justify;">Unfortunately, it isn't always possible to immediately source an expert with the specific industry knowledge and experience that a business transaction of this complexity calls for.</p><p class="bbox" style="text-align: justify;"><em>Investors are looking beyond expert network firms that rely on closed expert pools. They need&nbsp;</em><a href="" target="_blank" rel="noopener noreferrer"><em>expert surveys</em></a><em>&nbsp;at scale that yield insights and collect data points compiled from multiple expert consultations cross-referenced with relevant statistical data.</em></p><p style="text-align: justify;">By using multi-dimensional targeted and personalized expert surveys, investors can acquire the specific information they need.</p><h2><span style="font-size: 14pt;"><strong>The Traditional Approach: Closed Expert Groups and Incomplete Datasets</strong></span></h2><p style="text-align: justify;">Traditionally, expert network firms rely on a limited pool of vetted subject matter experts (SMEs) who are part of their closed network. It's not always possible to match an investor with the ideal expert within these constraints, especially with limited time.</p><p style="text-align: justify;">Additionally, <a href="" target="_blank" rel="noopener">conducting expert calls</a> and undertaking expert surveys with small sample sizes can lead to incomplete research and inadequate datasets, delaying the decision-making process.</p><h2 style="font-size: 14pt;">The New Normal: Custom-recruited Experts, Surveyed at Scale</h2><p style="text-align: justify;">Investors seek strategic advice from rigorously&nbsp;with highly specific industry knowledge backed by years of experience in the field, a strong network of connections, and extensive market knowledge. The valuation of a business is subject to variation depending on its industry, target market, and growth path, as each business is distinct in its own way.</p><p><img src=""></p><p style="text-align: justify;">The right subject matter expert would be equipped to provide clients with valuable insights when investigating a possible business opportunity or acquisition. But finding an expert that matches the exact criteria can be challenging.</p><p style="text-align: justify;">Rather than relying on dated methods, skilled expert network firms use automation to speed up the expert surveying and sourcing process. Going beyond conventional closed expert networks, professional expert network firms take an open-access approach to sourcing and recruiting subject matter experts.</p><p class="bbox" style="text-align: justify;"><em>A competent expert network firm is not confined to a limited expert pool. They can cast a wider net, conduct large-scale expert surveys quickly and efficiently, and then follow up with selected experts to narrow the search.</em></p><p style="text-align: justify;">Today's expert survey solutions incorporate automated processes to track down and recruit the perfect experts for any investor's <a style="text-decoration: underline !important; color: #16acef!important;" href="" target="_blank" rel="noopener">private equity</a> due diligence needs, even on stringent timelines.</p><p style="text-align: justify;">At Knowledge Ridge, we provide targeted or customized due diligence surveys in which an expert panel provides tailor-made responses to key questions. Our extensive online panel community includes niche market experts with direct experience from varied industries, sectors, and consumer demographics across 40+ countries. In addition to planning, we assist with questionnaire design, panel selection, effort and cost tracking, performance monitoring, and project closure.</p><h2 style="font-size: 14pt;">Reliable Expert Consultations for Enhanced Due Diligence</h2><p style="text-align: justify;">High-stakes negotiations come with several risks and major decisions hinging on expert advice and insights. This is why investors and venture capitalists rely on sound third-party due diligence to accurately appraise a brand or organization they're interested in acquiring. However, time constraints and the volatile nature of such negotiations can expose a few downsides to the due diligence process.</p><p style="text-align: justify;">While halting negotiations to engage in due diligence can help an organization assess the target company, provide transparency for both parties and ensure a cultural fit between the businesses, there are a few shortcomings. These include the expenses involved and the target company needing to divert operational resources to respond to questions and requests for documentation.</p><p style="text-align: justify;">Additionally, the company being acquired cannot solicit better or more competitive offers during the agreed-upon exclusivity period, which can be highly disadvantageous if the deal falls through during a protracted due diligence process.</p><p class="bbox" style="text-align: justify;"><em>Relying on a competent expert network firm to survey and source industry experts can mitigate the disadvantages and risks that come with private equity due diligence. &nbsp;</em></p><p style="text-align: justify;">An <a href="" target="_blank" rel="noopener noreferrer">accomplished expert network firm with a robust compliance framework</a> increases the likelihood of quickly locating the right experts for the task, giving investors accurate insights to make informed decisions and close transactions on time.</p><h2 style="font-size: 14pt;">Why Should You Choose Knowledge Ridge's Custom Expert Surveys?</h2><p class="bbox" style="text-align: justify;"><em>With extensive experience and access to a global network of experts,&nbsp;Knowledge Ridge&nbsp;offers targeted and&nbsp;</em><a href="" target="_blank" rel="noopener noreferrer"><em>custom expert surveys</em></a><em>&nbsp;to ensure that clients receive the precise knowledge they are looking for in the shortest time frame.</em></p><p style="text-align: justify;">Rather than being constrained within a limited pool of experts, Knowledge Ridge employs intelligent approaches designed to index specialized B2B knowledge and zero in on the ideal experts from millions of candidates worldwide.</p><p style="text-align: justify;">This custom recruitment model makes it possible to swiftly source subject matter experts that perfectly match the client's knowledge requirements, thus speeding up the commercial due diligence process with precise and relevant insights and accurate business performance projections.</p><p style="text-align: justify;"><a href="" target="_blank" rel="noopener noreferrer">Get in touch</a>&nbsp;for on-demand expertise from seasoned industry professionals to test new ideas, accelerate business strategy optimizations or make informed business decisions with quality-driven customized insights. <a href="" target="_blank" rel="noopener noreferrer">Know more about our core and values added services</a>.</p><h3 style="font-size: 14pt;">Frequently Asked Questions</h3><h2><span style="font-size: 12pt;"><strong>How do investors use expert networks for due diligence work?</strong></span></h2><p style="text-align: justify;">Investors use expert networks for due diligence work by leveraging their vast networks of subject matter experts to gain insights and validate investment theses. Expert networks connect investors with professionals in various industries, including academics, executives, consultants, and researchers, who can provide targeted insights and help them make informed investment decisions.</p><p style="text-align: justify;">Investors use expert networks to conduct market research, validate assumptions about industry trends, and gain access to specialized knowledge that may be difficult to obtain otherwise. Expert networks can also help investors assess potential risks and opportunities associated with an investment, providing a deeper understanding of the market and industry dynamics.</p><p style="text-align: justify;">Overall, expert networks are a valuable tool that investors can use to conduct thorough due diligence and make informed investment decisions.</p><h2><span style="font-size: 12pt;"><strong>What exactly is due diligence?</strong></span></h2><p style="text-align: justify;">Due diligence is an investigation or assessment of a business opportunity, usually conducted by investors, venture capitalists, or private equity firms, to gauge the feasibility of a planned acquisition or merger. It involves gathering and reviewing relevant information about a particular subject matter to help inform decision-making and to mitigate risks.</p><p>In the context of business, due diligence typically refers to the process of examining a company's financial, legal, and operational information before a potential investment or acquisition. It may also involve assessing the market conditions and industry trends to evaluate the potential risks and opportunities associated with a particular investment or business venture.</p><p>The due diligence process is critical to identifying potential issues or risks that may impact the success of an investment or decision. It helps to ensure that individuals or organizations have a comprehensive understanding of the subject matter and make informed decisions based on accurate information.</p><h2><span style="font-size: 12pt;"><strong>What are the most important aspects of due diligence?</strong></span></h2><p style="text-align: justify;">The most crucial components of due diligence are the valuation of a target company's assets and liabilities, risk evaluation, and the detection of pending legal proceedings. It depends on the specific context and purpose of the investigation, but generally, the following are key areas that should be thoroughly examined:</p><ol><li style="list-style-type: none;"><ol><li><p>Financial due diligence: This involves reviewing financial statements, tax records, cash flow projections, and other financial metrics to assess the financial health of a company and identify any potential risks or issues.</p></li><li><p>Legal due diligence: This involves reviewing contracts, agreements, and other legal documents to ensure compliance with regulations and laws, identify any legal issues, and assess potential liabilities.</p></li><li><p>Operational due diligence: This involves examining a company's operations, management, and systems to evaluate its efficiency, productivity, and effectiveness.</p></li><li><p>Market due diligence: This involves analyzing the target market, competition, and industry trends to assess potential risks and opportunities associated with a particular investment or business venture.</p></li><li><p>Environmental and social due diligence: This involves assessing a company's environmental and social impact to ensure compliance with regulations, identify any potential risks or issues, and assess potential reputational damage.</p></li></ol></li></ol><p style="text-align: start;">In addition to the above, other aspects that may be important include management and leadership, technology and innovation, customer and supplier relationships, and intellectual property. The level of due diligence required will depend on the specific context and purpose of the investigation and may vary depending on the size and complexity of the transaction or decision.</p>

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