Customer Diligence Use Cases: Turning Insights into Growth

Top private equity firms know: closing a deal is just the beginning.

While much of private equity’s focus is on pre-close diligence, the real opportunity emerges post-close - by systematically listening to the customer. 

That is, Customer Diligence engagements give firms an early read on retention risk, growth potential, and integration challenges that can kick into gear post-close.

If you want to get the most out of your diligence, consider these 5 ways you can use your findings:

1. Validate assumptions in real time.
Even after a successful acquisition, assumptions about pricing power, churn risk, and cross-sell potential need confirmation. 

Customer diligence can highlight gaps in customer expectations before they impact revenue.

2. Accelerate integration.
Understanding how customers perceive the newly combined entity or leadership changes enables faster operational alignment and targeted retention efforts.

3. Drive strategic growth initiatives.

Customer diligence insights reveal upsell and cross-sell opportunities, unmet needs, or product enhancements that directly impact revenue. 

By acting on these insights quickly, portfolio companies can unlock growth that management alone may have overlooked.

4. Protect against surprise churn.
Customers who feel heard are more likely to stay. 

Regular customer diligence engagement identifies dissatisfied clients before they leave and allows targeted remediation.

5. Create a roadmap for operators.
Customer intelligence gives operators a clear, data-driven strategy for where to invest time and resources for maximum impact.

These 5 uses, along with our expertise having run hundreds of private equity customer diligence engagements, remind us that the firms that treat customer intelligence as a continuous process - from diligence to post-close integration - consistently outperform. 

We believe strongly in this fact, it’s one of the reasons we help PE teams structure customer diligence programs that not only inform investment decisions but also accelerate portfolio value creation after closing. 

If you’re interested in seeing how customer diligence can help your deal pre and post close, book a free, 30 minute call with us to talk about what’s possible.