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Improve Your Private Equity Firm’s Due Diligence Toolset

Posted by Sam Lowder on Jun 12, 2019 5:14:00 AM

private equity analytics solutionsWhen sourcing new investment opportunities, your private equity team likely has a detailed series of steps to assess a potential investment for your portfolio and move into due diligence.

In private equity, sourcing investment opportunities can be an arduous process. Even if you’re a smaller firm, you might evaluate tens or hundreds of investments every month and only take a few beyond the consideration stage.

Once you move viable opportunities to investment committee and then due diligence, how formal (and thorough) is your process of evaluating potential transactions and what tools are you using?

Following sending that letter of intent, your due diligence process is where the all-important data collection process begins. This is where you really dig into everything—from answering operational questions to evaluating all legal agreements and intellectual property documentation to auditing those financials. Soon thereafter, you must build a detailed model (or several) to determine whether a target company is an investment you want to pursue.

How Private Equity Analytics Solutions Can Help You

Due diligence and model building are time consuming and suck up a lot of internal personnel resources, often for target possibilities you end up scrapping. If you’re considering investing in any sort of chain business—from retail to restaurant, from retail health care to consumer services—or a business with one or a couple locations that has potential to become a bigger chain, you’ll want to look into SiteSeer.

Does It Have the Potential?

Ultimately, the question you’re trying to answer with due diligence is whether a company will be a great investment or not. And just like with a single-company investment, when you’re considering an something like a consumer services or retail chain, you need to know if it has the potential to grow. Could that 10-store retailer grow to 100 stores? Is there actually a market for the concept?

SiteSeer can help with this—and the best news is that the system is valuable even after you make an investment. If you invest in a business with great potential that has been poorly operated for a long time, you can share SiteSeer with management of that business after you’ve helped them improve their operations and turn around their financial picture. Really, SiteSeer is a tool that private equity investors can use in three different stages:

  1. During buy-side due diligence when evaluating a company for purchase
  2. After acquiring a company to plan the best location strategy
  3. As a tool for the company itself to use going forward as they grow and mature to ensure that build out of the chain happens as planned to meet assumed financial targets

How can we help?

  • By helping you build a market potential model. Does your concept have the potential to grow, and if so, by how much?
  • By helping you simulate successful businesses and figuring out how to emulate those factors
  • By giving you a toolset to help your target chain build out its potential post acquisition using the same analysis used to determine long-term build-out opportunity.

Make Every Asset as Successful as Possible

That’s what SiteSeer can do for your private equity firm. Not only can you understand a target’s growth potential, you can use SiteSeer to analyze every asset in your portfolio. That means you can keep the winners, figure out a turnaround (or closure) plan for the strugglers, and optimize your portfolio.

Learn more about how to optimize the performance of your private equity portfolio using SiteSeer’s private equity analytics tools, predictive modeling, and more. Take a demo today.

Topics: Private Equity Industry, Analytics Solution