Tech Due Diligence
When investing in a tech company or product, as with any investment, a risk assessment needs to take place. This will help you make an informed decision about the investment and have the right idea about which areas of the business, product or process might need attention in the near future. As the company being researched, the tech due diligence process provides invaluable, actionable insights for improvement and gives you a benchmark of company performance from an outside expert’s perspective.
In a tech due diligence procedure, we look at a large number of aspects that may contribute to the risk level.
- Verify claims about the product’s features
- Inspect the condition of the code, architecture, and operating infrastructure
- Ensure security and data privacy requirements are met
- Verify claims about progress towards future goals
- Assess the development process and team-related risks
- Identify potential team gaps as opportunities for future growth
- Score various aspects of the technical assets on different metrics
- Provide suggestions for improvement in accordance with findings
The output of a tech due diligence procedure is a report. It describes in detail:
- Which aspects were assessed
- What methods were used to obtain an assessment
- Positive and negative findings that may diminish or increase the level of risk in an investment
The process very closely involves the target company’s team, as they must provide (access to) the necessary information. As such, this participation often resembles a valuable moment of reflection and will help provide the team with a renewed sense of direction to reduce risk, and thereby further improve the quality of the business. Don’t hesitate to get in touch if you see value in going through this procedure!
Interested?
Conducting a technical risk assessment could also be of value in the context of outsourcing software development, auditing vendors, or assessing offers and quotations! If you could benefit from (custom) services in this area, please contact me below to design a procedure that fits your needs!