Due Diligence Consulting for Startups, M&A & Investments

Due diligence consulting is the process of hiring external experts to systematically investigate a company before an investment, acquisition, or partnership. Consultants review financials, operations, legal standing, market position, and team capability to identify risks and validate the opportunity. For a general overview, see Investopedia's due diligence definition. At Waveup, we provide financial, commercial, and operational DD — with a focus on startups and growth companies that traditional firms often struggle to evaluate properly.

Cost depends on deal size, scope, and complexity. Our DD engagements start at $10K. Big 4 firms charge $200K-$1M+ for large transactions. At Waveup, you get startup-native expertise at a fraction of Big 4 pricing — contact us for a custom quote based on your specific deal and scope.

A focused financial DD for a startup takes 2-3 weeks. Comprehensive DD covering financial, commercial, and operational areas takes 4-6 weeks. Big 4 engagements can stretch to 2-4 months. Our average is 3-4 weeks for a full-scope DD report — we move faster because this is our core expertise, not a side practice we staff up for quarterly.

Financial due diligence is the analysis of a company's financial health — quality of earnings (QoE), revenue sustainability, working capital needs, normalized EBITDA, net debt and debt-like items, and cash flow patterns. For public companies, financial DD also covers compliance with SEC financial reporting requirements. For startups, financial DD includes ARR validation, churn cohort analysis, unit economics review, and burn rate assessment. The deliverable is typically a QoE report that investors, lenders, and investment committees rely on for their decision.

Commercial due diligence assesses the market opportunity, competitive landscape, and commercial viability of a business. It covers market size (TAM/SAM/SOM), customer concentration risk, sales pipeline quality, and go-to-market effectiveness. This tells investors whether the company can actually grow as projected — not just whether the numbers look good today. Having worked across 414 industries, we bring proprietary benchmarks that generalist firms can't access.

Buy-side DD is conducted by (or for) the acquirer or investor to validate the target company — you're looking for risks, deal-breakers, and valuation adjustments. Sell-side DD (also called vendor due diligence) is commissioned by the company being sold or funded to proactively identify and address issues before the buyer's team finds them. We work both sides — and that dual perspective means we know exactly where to look regardless of which side you're on.

At minimum: 3 years of financial statements, tax returns, cap table, major contracts, IP documentation, employee agreements, corporate governance docs, and any regulatory filings. For startups: add your financial model, KPI dashboard, customer cohort data, and burn rate analysis. Our due diligence checklist covers 50+ document categories — and we send it on day one so your data room is organized before we start. Missing a few items? That's normal at early stage. We'll work with what you have and flag what needs to be created.

Yes — and it should when the risks warrant it. Common deal-killers include undisclosed liabilities, customer concentration above 40%, material misstatements in financials, IP ownership disputes, and regulatory non-compliance. In our experience, about 30% of deals we diligence require significant price renegotiation based on findings. That's not DD failing — that's DD working. Better to find the red flags before closing than after.

Start 3-6 months before fundraising. Organize your data room, clean up your financials, resolve any legal loose ends, prepare your KPI dashboard, and document your cap table clearly. One of our SaaS clients had their Series B stall for 6 weeks because their data room was missing 3 documents — we fix that before it happens. Our sell-side DD prep service gets founders ready so nothing stalls the deal after the term sheet. Read our due diligence checklist for fundraising for the full breakdown.

A quality of earnings report normalizes a company's reported earnings to show sustainable, recurring profitability. It strips out one-time items, owner perks, non-cash adjustments, and aggressive accounting choices to reveal the true earning power of the business. For startups, QoE analysis extends to ARR quality, gross margin sustainability, and revenue recognition practices. It's the single most important deliverable in financial due diligence — and the document investment committees scrutinize most closely.