Management Due Diligence

How does Management Due Diligence help?

Firstly, it’s not about us, it’s about you. A fresh, objective perspective, strong, well-evidenced opinions, and practical, detailed outputs for investors and management teams to provide all the support they need to hit their grow plans and make a success of their business.

For Investors

We provide a deep understanding of the subtleties of the individuals and what drives them, as well as the team dynamics, so that investors have a really detailed, in-depth view of the team they’re investing in, and we give solid, practical advice on how to best support and get the best from the team to deliver the business plan.

  • Individual strengths, limitations, motivations, aspirations
  • Any potential gaps in the team
  • Bandwidth and potential succession
  • Best fit non-executives or new hires
  • Team views on growth plans and exit
  • Structuring and scaling the business
  • Gather views on any issues of concern to the investors
  • How to best support and work with the team

For Management Teams

Through the MDD process we get to know management teams very well, which means we can provide them with an honest, objective, insightful but practical perspective on each of the team, and on the team as a whole, highlighting strengths and areas to build on to hit the business growth aspirations.

  • Personal assessment and feedback for each of the team
  • Feedback on team composition in relation to the business plan
  • Highlighting potential gaps in the team
  • Raises different perspectives and ideas about the business
  • How to motivate and support each person through the private equity cycle
  • Full management due diligence report on the team
  • Personal development reports
  • Feedback discussion post deal (Management teams usually invite us back, post transaction, to take them through our views in more depth, and ask us specific questions.)

Our Management Due Diligence Approach

So far, we have worked closely with over 230 management teams taking on investment and so we really understand the pressures of the Private Equity deal process, and what is required to successfully deliver on the business plan.

Practical

What does that mean? Well, no theoretical frameworks, no jargon, no fancy graphs for the sake of it. We will have a deep understanding of the individuals and the team, so that we can determine motivation, skillsets and any potential gaps so that the team is best placed to deliver on the plan. We also give each of the team a full and frank feedback session.

Flexible

We understand the management team’s pressures, and the many work streams they’ll have going on, and so we will work around their schedules to minimise disruption to the business. We want the MDD process to add value, to be a positive, helpful and enjoyable experience, a learning process not a tick-box exercise or a distraction.

Honest and open

We listen (no, really listen), to truly understand the issues so that we can develop a fresh and accurate view and offer direct practical advice to the team, the individuals and the investors. We work in a spirit of openness, we share the individual assessments and reports with the each of the team, take management through our assessment as a team, and provide advice to the CEO.

Developmental

We see our role as supporting management, to get them into the best shape for this new world of investment, individually, and as a team, to better understand themselves, grow and develop, and so work positively, constructively and in partnership with their new investors.

What to expect in the Management Due Diligence Process?

1

Assess

Each person in the team will be set up on some individual, online assessment activities to be completed before we meet. These are just personality and behaviour questionnaires (there are no right or wrong answers, no pass or fail!), which are a helpful jumping off point for our discussions. One of the assessments will automatically bounce back with an in-depth personality profile to the individual team members.

2

Discuss

Then we’ll meet with each of the team, individually, for two hours or so to get to know each of them as people, and to have an honest discussion about the team and the business. And we’ll explore the results of the personality questionnaires and what it means ‘in real life,’ and provide coaching and advice if it’s helpful.

3

Feedback

After our sessions with the team, we will have an initial debrief with the investors to take them through our views. It’s important that the investors understand the team and how to best work with them going forward, what support they’ll need etc, and this session allows the investors to question us, drill deeper, ask for evidence, etc.

4

Report

Then we’ll write a report for the investors, which will help inform their investment decisions and provide practical advice on the individuals, the team, their motivations, any reservations and how to work with the team to get the best out of them. We’re happy to share this with the CEO or the wider team once the deal is completed and things have settled down. We’re always happy to discuss the feedback with the team or with investors to and give our honest opinions to help support the growth of the business.

5

Report

Often there is an area that the team wants to work on post deal, whether it be recruiting a new director, coaching and advice to some of the team or helping the team work more effectively together, we use our experience of over 230 investments, and our deep knowledge of the team, and the business plan, to help them guide them to get it right.