Dallas, TX, July 18, 2022 – SBI, a Growth Advisory, today announced the enhancement of their SBI Growth Due Diligence offering. Specifically designed to meet the demands of changing market conditions and the varied needs of PE partners, the practice offers three levels of assessment complexity. This empowers deal teams to identify and achieve growth opportunities at varying stages of diligence through SBI’s established process, anchored to growth creation levers.
“As markets have grown more fluid, being able to underwrite to a growth thesis with certainty has become more important than ever to private equity. Conducting due diligence that more accurately predicts revenue opportunities and the levers that will achieve that growth, is critical to investors evaluating opportunities,” explained SBI CEO Mike Hoffman.
SBI focuses on each acquisition target’s specific value creation thesis to anchor to four potential growth creation levers. Specifically, SBI evaluates:
- How to Create Operating Leverage: If current spend is in line with best practice but delivering insufficient growth, what are the primary productivity levers that can be pulled to create growth quickly?
- How to Invest for Growth: When there is tremendous future growth potential, where should investment bets be placed to generate outsized returns?
- How to Approach a Revenue Model Shift: If the revenue model is in transition, or needs to be changed, how can the transition be approached without increasing cost or delaying growth?
- How to Maintain Growth with Less Spend: In instances where growth of the asset is acceptable, but the costs are above peers and best practice, how can cost be reduced without disrupting the current growth trajectory?
“SBI Growth advisors have evaluated countless deals and applied these insights to drive growth. SBI works across industries–including technology, business services, industrials, and healthcare–to help our private equity partners assess and achieve growth effectively. Having successfully launched this methodology for multiple top-tier PE funds, we are excited to expand the offering at a variety of stages to more precisely meet our clients’ needs. Whether they are conducting an initial assessment or doing a thorough deep dive investigation, SBI’s Growth Due Diligence can be tailored to an appropriate level of involvement and complexity,” Hoffman emphasized. The three levels of diligence include:
- CIM/CIP Screen: Using rapid diagnostics and/or initial benchmarks to screen viability, SBI identifies red flags or deal-breakers, and recommends questions to address with management.
- Go/No Go Diligence: Advisors validate the worthiness of a formal offer and identify sub-optimal functions that will require change/investment. Former and current management is interviewed, available data is reviewed, and competitive intel and market feedback is evaluated.
- Growth Diligence: A deep dive into the growth thesis including identification of growth levers, potential upside over time, cost assumptions and risks. These findings function as a preliminary value creation plan. Sequenced revenue growth and risk mitigation strategies are delivered, and opportunities are quantified and prioritized.
SBI is a Growth Advisory offering collaborative consulting, advisory services, and the world’s most comprehensive set of go-to-market benchmark data. Our team of strategic implementers have owned and operated the marketing and sales functions at the world’s most successful growth companies. Our approach is based on an intimate understanding of the buyer-seller journey. Working as an extension of our clients’ teams, SBI applies relevant data and insights to deliver impactful strategies that generate significant ongoing top-line growth. Visit https://sbigrowth.com/growth-due-diligence to learn more.