Private Equity Due Diligence Checklist: Value Levers, Risks, and a 30-Day Plan Post-Close
Quick answer
Good diligence tests whether the value plan is real and executable in the first 100 days. Check revenue quality, cost structure, working capital, systems, leadership depth, and the top risks that could break the plan. Convert findings into a short post-close plan with KPIs and owners.
What this private equity due diligence checklist is
This private equity due diligence checklist is built for one outcome: prove (or disprove) the investment thesis and convert it into an executable plan for Day 1 through Day 100. It is not a document request dump. It is a decision tool: what is true, what is risky, what creates value, and what do we do next.
It covers operational due diligence checklist items, commercial due diligence questions, an IT due diligence questionnaire starter set, and a deal risk checklist that forces owners and KPIs.
How to use it in PE due diligence
- Write the thesis in one paragraph, then list 5 to 10 claims that must be true.
- Map each claim to proof, owners, and a timebox (often 2 to 6 weeks depending on process).
- Separate “can price or structure” items vs. “cannot own” items (deal breakers).
- Convert findings into a 30-day plan post-close with KPIs, owners, and weekly tracking.
Value levers checklist (where returns usually come from)
Use this list as a value creation plan template. Each lever needs: baseline, target, owner, timeline, and proof that the capability exists (or the cost to build it).
| Lever | What to test in diligence | Evidence to request |
|---|---|---|
| Pricing and mix | Price leakage, discounting behavior, win-loss, mix shifts | Transaction data, discount policy, approvals, quotes vs. invoices |
| Sales productivity | Pipeline quality, coverage, quota setting, churn drivers | CRM exports, funnel metrics, cohort retention, comp plans |
| Gross margin and delivery | Labor model, utilization, scrap/rework, vendor terms | Job costing, timekeeping, BOM, vendor spend by category |
| SG&A and overhead | Span of control, duplicate work, outsourcers, facilities | Org charts, vendor lists, GL detail, headcount by function |
| Working capital | DSO, DPO, inventory turns, billing discipline | AR aging, AP aging, inventory aging, credit memo trends |
| Systems and data | Tech debt, reporting gaps, manual work, security posture | Architecture map, incident history, access model, key tools list |
Deal risk checklist (what can break the plan)
This deal risk checklist focuses on risks that change valuation, structure, or the ability to execute. It is not exhaustive, but it catches the issues that most often show up in the first 30 days post-close.
Deal risk checklist (copy/paste)
Revenue and customers
[ ] Customer concentration, renewal risk, and churn drivers are quantified
[ ] Contract terms reviewed (pricing, rebates, SLAs, termination)
[ ] Pipeline and backlog quality validated (not just reported)
Costs and margins
[ ] Gross margin bridge reconciles to product, customer, or job-level drivers
[ ] One-time vs. recurring costs are separated with proof
[ ] Procurement and vendor dependencies mapped (single-source risks)
Working capital and cash
[ ] AR collectability assessed; disputes and credits quantified
[ ] Inventory quality assessed (obsolete, slow-moving, write-down exposure)
[ ] Payment terms and vendor criticality mapped
Technology and security
[ ] Key systems stability and integration readiness assessed
[ ] Access controls, logging, and incident history reviewed
[ ] Third-party SaaS and data processors listed with contract terms
Legal, regulatory, and people
[ ] Material disputes, compliance issues, or regulatory exposure identified
[ ] Key person risk assessed; leadership depth and succession gaps documented
[ ] Any labor, safety, or union issues mapped with mitigation owners
Commercial due diligence questions
Use these commercial due diligence questions to validate demand, price, competition, and the durability of revenue. Keep answers tied to data, not narrative.
- What is driving growth: new logos, expansion, price, or mix?
- What is the real retention and churn by cohort and segment?
- What are the top 5 reasons deals are won and lost?
- Where does price leak: discounting, rebilling, credits, or concessions?
- Which products or customers are unprofitable after service and support?
- What is the competitive threat in the next 12 months?
Operational due diligence checklist
Operational diligence is where “the model” meets reality: how work is delivered, where cost sits, and what breaks at scale. This operational due diligence checklist is meant to be completed with site visits, data pulls, and management working sessions.
Operational diligence (copy/paste)
Operations and delivery
[ ] End-to-end process map exists (order to cash, procure to pay, plan to produce, hire to retire)
[ ] Capacity constraints and bottlenecks quantified (not anecdotal)
[ ] Quality and rework measured with cost impact
Cost structure
[ ] Cost bridge explains changes (price, volume, mix, labor, materials, overhead)
[ ] Labor model and utilization assumptions validated
[ ] Outsourcing and contractor spend reviewed by category
Supply chain and procurement
[ ] Top suppliers by spend and criticality identified
[ ] Single-source and long lead-time risks documented
[ ] Contract terms and renewal dates captured for key vendors
Working capital mechanics
[ ] Billing accuracy and dispute cycle time measured
[ ] Collections process and segmentation defined
[ ] Inventory controls and write-down exposure assessed
IT due diligence questionnaire (starter set)
Teams searching “IT due diligence questionnaire” usually want a short list that covers: systems, security, scalability, and integration risk. Use this as a starting point, then add deal-specific items.
IT diligence questions (copy/paste)
Technology footprint
[ ] What are the core systems (ERP, CRM, billing, data warehouse) and who owns each?
[ ] Which systems are end-of-life or unsupported?
[ ] What is the top manual work and where are the reporting gaps?
Security and privacy
[ ] Who has admin access and how is access reviewed?
[ ] What is the incident history (including near misses) and corrective actions?
[ ] What third-party vendors process sensitive data and what contracts apply?
Reliability and scalability
[ ] Current uptime and top causes of outages
[ ] Key integrations and where they fail
[ ] Estimated spend required to stabilize or modernize in the first 12 months
Integration readiness
[ ] Day 1 access plan and identity controls
[ ] Data migration risks and quality issues
[ ] Contract lock-ins and termination fees
Sources: [S4], External:
Private Infrastructure Partners,
Dataprise
People and leadership diligence
Leadership depth is often the deciding factor in whether a value plan becomes real. Treat this as a “buyer vs. operator” test: can the current team run the business while also changing it?
- Who owns each value lever post-close, and do they have capacity?
- What roles are missing for the first 100 days (pricing, ops, finance, technology)?
- What is the decision cadence: weekly performance, monthly close, quarterly planning?
- What incentives drive behavior, and do they align with the value plan?
30-day plan post-close (feeds a 100 day plan private equity)
The 30-day plan post-close should be short and operational. It should not be a long list of tasks. It should define the first set of decisions, owners, KPIs, and meeting cadence.
30-day plan template (copy/paste)
Week 1: Control and transparency
- Confirm cash and working capital controls (daily cash view, weekly AR/AP cadence)
- Establish KPIs and definitions (one page)
- Confirm decision rights and weekly operating cadence
Week 2: Validate the thesis with real data
- Revenue quality deep-dive (cohorts, concentration, churn, price leakage)
- Cost bridge and margin drivers (what is structural vs. temporary)
- Top operational constraints and quick fixes
Week 3: Launch the first 2 to 3 value levers
- One lever per owner with baseline, target, and weekly tracking
- Remove the top blockers (systems, approvals, vendor constraints)
Week 4: Lock the 100-day plan and governance
- Convert findings into a 100-day plan with milestones
- Add a risks and dependencies log with owners
- Confirm reporting pack for investors and lenders (if applicable)
Seller due diligence checklist (for data room readiness)
A seller due diligence checklist reduces re-trades and accelerates the process. Focus on items that answer buyer questions quickly and consistently.
- Quality of earnings support: clear bridges, policy notes, and normalized adjustments.
- Customer file: contracts, pricing, churn, pipeline, and major disputes.
- Operations file: process maps, capacity, quality, supplier concentration, and safety items.
- Technology file: systems list, integrations, access model, and incident history summary.
- People file: org charts, comp bands, key roles, and any retention risks.
Investor and investment manager due diligence checklist
People also search for “investor due diligence checklist,” “investment manager due diligence checklist,” and “alternative investment due diligence checklist.” Those are typically fund and manager diligence (GP diligence) rather than target-company diligence. A common reference is the ILPA due diligence questionnaire.
Sources: [S5], External:
ILPA DDQ (PDF)
The 4 P’s and 5 P’s of due diligence
What are the 4 P’s of due diligence?
A practical 4P set is: People, Product (or offering), Process, and Performance. Use it as a fast screen, then expand into the full checklist and the 30-day plan.
What are the 5 P’s of due diligence?
Teams use different versions. A practical 5P set for private equity is: People (leadership depth), Performance (revenue and margin quality), Process (how work is done and controlled), Platform (systems and data), and Price (what must be true for the deal to work).
What is the 80 20 rule in private equity?
The 80/20 rule (Pareto idea) is often used to force focus: a small share of value levers and risks usually drives most of the outcome. In diligence, apply it by identifying the top 3 levers and top 3 risks, then proving them with data and executable actions.
Sources: [S6], External:
Investopedia
Private equity due diligence checklist PDF and “private equity due diligence pdf” searches
If you are looking for a private equity due diligence checklist PDF, treat it as a starting point, not a solution. The deliverable that matters is a decision pack and a post-close plan with owners and KPIs. If you want a PDF download on your site, consider offering:
- A one-page checklist (commercial, operational, technology, legal, people).
- A value creation plan template (baseline, target, owner, timeline, proof).
- A 30-day plan post-close template that feeds your 100 day plan private equity.
Related search terms this page targets:
- Private equity due diligence checklist PDF
- Private equity due diligence pdf
- PE due diligence
- IT due diligence questionnaire
- Seller due diligence checklist
- Investor due diligence checklist
- Alternative investment due diligence checklist
- Investment manager due diligence checklist
FAQ
What are the 5 P’s of due diligence?
Teams use different versions. A practical 5P set for private equity is: People, Performance, Process, Platform, and Price. Use it to force focus, then prove each area with data.
What should be included in a due diligence checklist?
Financial quality, working capital and cash, commercial demand and pricing, operations and cost structure, technology and security, legal and regulatory items, and people risks. The checklist should also force a post-close plan with owners and KPIs.
What are the 4 P’s of due diligence?
A practical 4P set is: People, Product (or offering), Process, and Performance. Use it as a fast screen, then expand into the full checklist.
What is the 80 20 rule in private equity?
It is the Pareto idea applied to returns and execution: a small share of actions or levers often drives most of the impact. In diligence, prioritize the few levers and risks that can move outcomes, then prove them with data and an executable plan.
If you want a diligence checklist tailored to your deal, plus a 30-day plan and a 100-day operating cadence:
contact NMS Consulting.
Sources
- S1. Bain & Company, “Private Equity Due Diligence Consulting.” Accessed 2026-01-01. https://www.bain.com/industry-expertise/private-equity/due-diligence/
- S2. PwC, “Due diligence for mergers and acquisitions.” Accessed 2026-01-01. https://www.pwc.com/us/en/services/consulting/deals/acquisitions/due-diligence.html
- S3. McKinsey, “Value creation: the impact counts, not the plan.” Accessed 2026-01-01. https://www.mckinsey.com/uk/our-insights/uk-insights/value-creation-the-impact-counts-not-the-plan
- S4. Private Infrastructure Partners, “IT Due Diligence Checklist: Must-Assess Technology Elements.” Accessed 2026-01-01. https://www.pipartners.com/it-due-diligence-checklist/
- S5. Institutional Limited Partners Association (ILPA), “Standardized Due Diligence Questionnaire (DDQ) v1.2” (PDF). Accessed 2026-01-01. https://ilpa.org/wp-content/uploads/2018/09/ILPA_Due_Diligence_Questionnaire_v1.2.pdf
- S6. Investopedia, “The 80-20 Rule (aka Pareto Principle): What It Is and How It Works.” Updated May 30, 2025. Accessed 2026-01-01. https://www.investopedia.com/terms/1/80-20-rule.asp
- S7. McKinsey, “Bridging private equity’s value creation gap.” Accessed 2026-01-01. https://www.mckinsey.com/industries/private-capital/our-insights/bridging-private-equitys-value-creation-gap
