Portfolio: Digital Due Diligence.

Study: Innovation Champions 2018.
December 6, 2018

Your contact

t +49 – 89 – 1250 1590
info[a]munich-strategy.com
Dr. Sebastian
Theopold
Merlin
de Graaf
Dr. Sebastian
Theopold
Merlin
de Graaf
PORTFOLIO
 

Digital Due Diligence.

The digital age calls for a fundamental rethink of the due diligence process. Munich Strategy and BLOOM combine industry know-how and digital expertise.

Today, an assessment of a potential target’s online performance and capabilities is a pivotal part of almost every commercial due diligence process. This is not just the case for pure online players, but also for traditional businesses with any type of online activities. No business can afford to ignore digital opportunities.

Reasons to perform a digital due diligence

A due diligence is usually performed on behalf of investors seeking objective information for their investment decision. This includes the question of whether a target’s business model will be sustainable in a changing market and competitive landscape or whether growth can be achieved through digital channels.
Which disruptive players could enter the market? How many new customers can be engaged through online channels? Has the organization adopted agile methods that allow for continuous improvement? Our team will answer these questions in a digital due diligence.

What a digital due diligence by Munich Strategy and BLOOM includes (not exhaustive)

1. Market and trends
Our consultants understand how business is done in the food and construction industries and how it will change in the future. We know the current trends and drivers in your industries, the technologies that could fundamentally change them and digitization levels in the markets. We have the benchmarks and know which digital channels can drive growth in your industries.
2. Competitive landscape
Industry 4.0 and digitization will fundamentally change companies’ value chains. We understand these new dynamics and analyze which new players will become more important in the future and which competitors will lose significance.
3. Product and value proposition
A traditional due diligence mainly focuses on market segmentation, market shares and financials and matches these numbers with consumer research data. In a digital due diligence we also look at technical scalability, retention, user experience, programming languages, direct and indirect network effects.
4. Online performance
EBITDA, revenues and COGS are covered in a traditional due diligence. Within the scope of a digital due diligence we also focus on traffic, conversion, CLV, CAC and many other online KPIs.
5. Organization and team
Companies that want to be successful in the future need to have a solid digital foundation in their organization, capabilities and data and system infrastructure. Foundations of online and data analysis should be known across the company, also in non-technical functions. Within a digital due diligence we also look at a company’s ‘way of working’, e.g., whether the team has adopted agile methods that allow for continuous improvement.
Would you like to know your company’s digital maturity level or have us investigate whether a target company in the food & packaging, mechanical engineering or construction industries is prepared for the digital future? Talk to us.

Content of a Digital Due Diligence

  • Market and trends
  • Competitive landscape
  • Product and value proposition
  • Online performance
  • Organization and team

Learn more

“Munich Strategy and data strategist BLOOM join forces to help clients grow digitally” (Press release)

Learn more

“We want to make our clients think like online entrepreneurs” (Interview with Sebastian Theopold and Eric Klaassen)