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Customer & Commercial Due Diligence
Our commercial due diligence examines the customer behavior beneath the revenue line, analyzing retention, conversion and adoption data alongside structured interviews so investors understand how durable a target's growth really is.
The problem behind the problem.
Most commercial due diligence answers market questions well: how large the opportunity is, how fast it is growing and how the target is positioned against competitors. It is less reliable on customer questions. A survey of current customers may report high satisfaction while usage data shows engagement quietly declining. Reference calls tend to reach the happiest accounts. Revenue that looks recurring may depend on a few large customers, a renewal cycle that has not yet been tested, or contracts that are signed but barely used.
These are questions about quality of revenue, and they are fundamentally behavioral. Customers reveal their real intentions in what they do: how quickly they adopt, which features they rely on, whether usage spreads across their organization, and how they respond to price changes. When diligence relies on stated preferences instead of revealed behavior, investors can pay for growth that will not persist. Commercial due diligence built on behavioral data gives the deal team a sharper view of retention risk, expansion potential and the assumptions in the model that the evidence does not support.
How we deliver customer & commercial due diligence.
- 01Observe
Hear from the right customers
We design and conduct structured customer interviews that reach beyond the reference list, including recent wins, lapsed accounts and lost prospects where possible. Interview guides are built with research methods that reduce bias and probe for real decision drivers, switching costs and unmet needs, rather than asking customers to rate their satisfaction.
- 02Signal
Analyze retention and adoption
We analyze customer-level revenue and usage data for cohort and logo retention, expansion and contraction behavior, concentration, and adoption depth by segment. We identify the conversion points that predict whether an account grows or churns, and define behavioral types of customers. Net revenue retention is examined qualitatively by cohort to show what is driving it, not just its headline level.
- 03Design
Reconcile said and done
We compare what customers report in interviews and surveys with what they do in the data. Where the two diverge, we explain why and what it means for the investment thesis. The output is a clear, prioritized view of which growth assumptions in the model are well supported, which are uncertain, and which warrant price or structural protection.
- 04Test
Stress-test the revenue model
We translate behavioral findings into scenarios the deal team can use: retention assumptions by cohort, plausible ranges for expansion, and the sensitivity of the plan to changes in key customer behaviors. Where a hypothesis can be checked quickly, for example through a targeted data cut or additional interviews, we test it before the IC meeting.
- 05Scale
Carry findings past close
Diligence findings should not end at signing. We convert them into a baseline of predictive customer KPIs and a list of retention and expansion hypotheses for the 100-day plan, so operating partners and management start the hold period with an evidence base and a shared understanding of where customer risk lies.
Deliverables.
What changes.
Who engages us.
We support private equity deal teams, growth equity investors, venture capital firms leading later rounds, family offices and corporate development teams evaluating acquisitions. Engagements most often occur pre-LOI, when a quick behavioral read can shape price and structure, and during confirmatory diligence, when deeper analysis of the data room and customer interviews can confirm or challenge the thesis. We also conduct sell-side customer analysis for companies preparing for a sale or recapitalization.
Industries
Beyond the balance sheet.
Understanding customers deeply is good for returns and good for customers. When diligence shows where a product falls short of what customers need, the resulting value creation plan can focus on improving the product and service rather than extracting more from the same accounts. Our commercial due diligence highlights where customer trust is strong and where it is fragile, helping investors back businesses that earn loyalty rather than depend on lock-in or friction.
Frequently asked questions.
What is the difference between stated and revealed customer behavior?
Stated behavior is what customers tell you: satisfaction scores, intent to renew, interview responses. Revealed behavior is what they actually do: usage, renewal, expansion, support contacts. The two often diverge, and the gap is informative. A customer who reports high satisfaction while usage declines is a retention risk. We analyze both and explain the differences so investors are not relying on stated preference alone.
How do you evaluate net revenue retention?
We look beyond the headline figure to how it is composed. Strong overall retention can mask weak cohorts offset by a few large expansions, or recent cohorts that behave differently from older ones. We break retention down by cohort, segment, product and customer size, and connect patterns to behavioral drivers such as onboarding quality and adoption depth, so the deal team understands whether the pattern is likely to persist.
Can you work alongside our existing diligence advisors?
Yes. We frequently complement market-focused commercial diligence, quality of earnings and technology diligence providers. Our scope focuses on customer behavior and the human assumptions in the thesis, which are often under-covered. We coordinate with other advisors to avoid duplicated interviews and data requests, and to make sure findings from each workstream inform the others.
What if the target's data is messy or incomplete?
It usually is. Customer data in growing companies is often spread across billing, CRM and product systems that were never integrated. We are experienced at reconciling unintegrated datasets and at stating clearly what can and cannot be concluded from them. Where gaps remain, we use structured interviews to fill them and flag the remaining uncertainty for the deal team.
Often paired with.
Private Equity Advisory
Behavioral science for sponsors and operating partners: pressure-test the thesis before LOI, assess management, and build the KPIs that guide the hold.
ExploreManagement Team Assessment
Research-grade evaluation of leadership teams for investors: capabilities, key-person risk, team dynamics and readiness to execute the plan ahead.
ExploreVenture Capital & Startup Advisory
Help for venture investors and founders to read early traction honestly, set milestones that matter between rounds, and scale without losing what works.
ExploreRelated insights.
Finding the Conversion Points in a Customer Journey
How to identify the few behavioral moments in a customer journey where outcomes are actually decided, and how to measure and improve them with evidence.
Read
Behavioral vs. Demographic Segmentation
Why segmenting people by what they do often predicts outcomes better than segmenting by who they are, and how to build behavioral segments that teams can use.
ReadReady to talk about customer & commercial due diligence?
Every engagement begins with a conversation. Tell us what you are facing and we will tell you, candidly, how we would approach it.
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