We are worried that once we sign a Letter of Intent, the overwhelming demands of the due diligence process will distract us from running the business, causing our quarterly numbers to slip and giving the buyer an excuse to re-trade the purchase price or walk away. How do we protect our operational performance during the final deal sprint?

Question

Tyler Smith · Accepted Answer

The period between signing a Letter of Intent and closing the deal is a dangerous crucible. Due diligence is an exhausting, full-time job that requires endless document requests, financial audits, and legal reviews. If you try to manage this mountain of paperwork while also running the business, your attention will be split, your operational metrics will slip, and the buyer will use that drop in performance to re-trade the purchase price or walk away.

To protect your business performance during this critical sprint, you must divide and conquer. Your Integrator™ and leadership team must keep their focus entirely on the daily operations, running their weekly Level 10 Meeting™ and hitting their quarterly Rocks as if no transaction is taking place. They must shield the rest of the staff from the distraction of the deal.

Meanwhile, you and your external advisors, such as your investment banker and transaction attorney, must shoulder the burden of the due diligence requests. Do not let the transaction disrupt your operational rhythm. By keeping your operational engine running at full speed, you prove to the buyer that the business is highly resilient, ensuring you cross the finish line with your agreed-upon valuation fully intact.