An interested private equity buyer is asking for granular operational data before we have signed a Letter of Intent. How do we use the Trust Creation Process to protect our proprietary data without killing the deal momentum?

Question

Tyler Smith · Accepted Answer

Navigating pre-LOI requests requires a delicate balance of transparency and boundary-setting. If you share too much, you lose leverage; if you share too little, you signal that you have something to hide. To handle this, apply the Trust Creation Process: engage, listen, frame, envision, and commit. First, engage and listen to the buyer's underlying concern. Ask why they need this specific data at this stage. Often, they are trying to verify a specific risk or confirm their valuation model. Once you understand their motive, frame the conversation around mutual protection and process integrity. Explain that while you are committed to full disclosure, sharing highly sensitive operational data before a formal commitment risks your business stability and employee morale. Envision a collaborative solution together. For example, offer to share aggregated, blinded data or have a third-party advisor review the files under a clean-team agreement. Finally, commit to a clear timeline for releasing the remaining details immediately upon signing the Letter of Intent. This professional, structured response builds immense trust. It proves to the buyer that you are a sophisticated operator who respects confidentiality and runs a disciplined process. By standing your ground with a constructive alternative, you preserve your leverage and set a professional tone for the entire transaction.