Corporate development buys differently from private equity, and most diligence products are built for private equity.
A corporate or strategic development office typically runs more transactions, at smaller sizes, with no dedicated diligence bench, against a mandate defined by the operating plan rather than by an entry multiple. The team is often two or three people supporting several business units, and it is judged on whether the acquired business integrates and performs — not on whether it was bought at a good price relative to a comp set.
That changes what good diligence looks like.
Three things that are structurally different
Volume over depth. A programmatic acquirer doing four to eight tuck-ins a year cannot commission a full-scope quality of earnings on every target and does not need to. What it needs is a consistent verification standard applied to all of them, so that a deal team can compare targets on the same basis and an investment committee can rely on the file without re-litigating the method each time.
No bench. Private equity firms have operating partners and a stable of advisors. Corporate development often borrows finance staff from the business unit, which means diligence competes with month-end close. Anything that reduces the manual reconstruction work is not a convenience — it is what makes the deal happen at all.
Integration is the scorecard. The thing that hurts a strategic acquirer eighteen months later is rarely that the multiple was half a turn high. It is that the acquired revenue was not what it appeared, the working capital was worse than modeled, or a customer relationship did not survive the change of control. All three are visible in the cash if somebody looks.
Where the cash work earns its place
The patterns we see most often in strategic deals below the mid-market:
- Revenue recognition against collections. When reported revenue and cash collection diverge, the gap is either a timing convention or a problem. Matching invoice to payment across the full period tells you which.
- Customer cohort reality. A customer who gives notice in January and pays through April is not a churn event in January. Reading churn off the last invoice rather than the notice date changes retention materially, and retention is usually what the synergy case is built on.
- Related-party and owner activity. Rent paid to an entity the seller owns, a family member on payroll, personal expenses run through the business. Every one of these is an integration surprise if it is not identified before close.
- Multi-site and multi-entity structure. Money moves between accounts the same owner controls. Treat those transfers as revenue and the top line is fiction; suppress them too aggressively and real cash disappears.
These are examined in more detail in four things that break a proof of cash.
A workable model for a programmatic acquirer
Split the work. The mechanical half — reconstructing cash receipts and disbursements, matching bank activity to the ledger, mapping the trial balance, reading agreements into a schedule — scales with record quality, not deal size, and it can be run on every target cheaply. The judgment half — whether an add-back is defensible, whether revenue survives the change of control — should be applied only where the amount at stake warrants it.
That inverts the usual pattern, where the early look is shallow and the deep look comes late. A full-period proof of cash run at the screening stage is both cheaper and more diagnostic than a sampled review under exclusivity, because sampling is exactly what lets a bad quarter hide. The same logic applies to private equity tuck-in programs: do you need a full QoE for a small add-on?
What we provide
A complete proof of cash within 24 hours of data ingestion and GAAP-formatted financial statements, including reported EBITDA, within 48. On a recent trailing-twelve-month engagement that meant 431 manually scanned bank statements across 36 bank accounts, 29,823 transactions, and a 99.4% average match rate with one $32 variance left flagged for a person.
Every figure traces back to the bank statement line and general ledger entry behind it, which is what makes the file usable in front of an investment committee. Pricing is published: what a quality of earnings costs. Talk to us about a program rather than a single deal.