Writing your diligence report

A diligence report is a 5–10 page internal document you write *for yourself* at the end of the diligence period. Most buyers skip it, and then forget half of what they learned by closing day. Don't be that buyer.

Section 1: Deal summary. Asking price, your offer, key terms (financing, escrow, transition window), seller motivation, who's on the buyer side (CPA, lawyer, lender).

Section 2: Financial picture. Trailing 12-month revenue (verified from bank), recurring %, average ticket, gross margin estimate, net margin estimate, your conservative re-underwrite. List every adjustment you made and why.

Section 3: Customer base. Account count, tenure histogram, concentration risk (top 5/10 accounts and their %), churn last 24 months, results of customer interviews.

Section 4: Operations. Density assessment (with map), tech situation, equipment condition, software stack, SOPs.

Section 5: Risks. Every concern, big or small. Concentration, weather, regulatory, key tech, lease/non-compete on the seller, anything weird in the books. Score each: low / medium / high. Add a mitigation for each.

Section 6: First-90-day plan. What you'll do operationally before close, on close day, and in the first 30 / 60 / 90 days. Customer letters, software setup, ride-along schedule, etc.

Section 7: Go / no-go. A one-paragraph honest assessment. If you wouldn't write this paragraph confidently, you're not ready to close.

Re-read the report 7 days after writing. Anything that still feels uncertain is your final negotiation list, or your reason to walk.