If you’ve considered the need for sales and marketing due diligence as part of the acquisition or funding process, you are making a sound decision. If you’ve recognized the need for a professional third party to conduct the investigation, you’re ahead of the pack.
It’s a prudent path in 2017 and beyond to include marketplace factors in your final assessment of value and as a “patch of burning sand” to cross before making a final decision to proceed on the deal. After all, if existing and target customers don’t buy in the expected time frame, you and your stakeholders could be disappointed later.
Beyond the decision to include Sales and Marketing in your due diligence mix, there are questions about execution. Usually, there is a coordination of effort between all parties on the deal-track, including the professionals conducting the other due diligence, so that the deal progresses smoothly, in accordance with the timetable set forth in the LOI.
Because the sales and marketing aspect of the due diligence involves significant contact with key individuals not involved in the deal, it’s important to get this started right away. Customers and channel members are feeling no urgency to respond to research inquiries; they are not aware of the pending deal.
Part of the art and science of this delicate work is to read future buying intentions and preferences without disclosing what the conversation is really about. Confidentiality is not just important, it’s crucial to the seller, who doesn’t want to disclose a potential sale to valued customers — and especially not to eager competitors.
Something to consider when you are pulling the trigger on an offer – timing is everything.