AI Due Diligence: The Future of Decision-Making in M&A

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The days of a purely human-led M&A process are numbered. With AI due diligence, businesses can automate and speed up a number of time-consuming tasks, making the entire process more efficient and accurate. An increasing number of consultancies and PE firms are modernising the M&A process with the help of AI, and it’s not hard to see why.

So, what exactly is AI due diligence? And what benefits does it offer to businesses looking to make a successful acquisition? Here’s what you need to know about the future of decision-making in M&A that’s fast becoming the norm.

What Is AI Due Diligence?

Artificial intelligence due diligence is the process of using AI technologies to assess a target company during the M&A process. This can include everything from financial analysis and market research to competitive analysis and customer sentiment analysis.

AI due diligence is often used in conjunction with traditional human-led due diligence, providing a more comprehensive overview of a target company. Increasingly, businesses are trusting AI to provide accurate and reliable insights that can help inform their decision-making.

The Need for Speed

AI due diligence meets a pressing need in the M&A process for speed and accuracy. In a fast-paced and competitive market, businesses need to be able to move quickly and make decisions with confidence.

With AI due diligence, businesses can automate tasks that would traditionally be carried out by humans. This frees up time and resources so that businesses can focus on other aspects of the M&A process.

What’s more, AI can provide a level of accuracy and detail that human analysts simply cannot match. By harnessing the power of data, businesses can gain a comprehensive understanding of a target company that would otherwise be impossible to achieve.

One thing’s for sure, we’re not short on data, and it’s only going to increase. It’s estimated that by 2025, we will generate 181 zettabytes of data per year, (that’s 181,000,000,000,000,000,000,000 bytes!). For context, we produced 79 zettabytes of data in 2021.

With all that data available, the challenge is gathering and processing relevant data and making sense of it while it’s still useful to inform decision-making. This is where AI comes in.

What are the benefits of AI due diligence?

There are several reasons why AI is fast becoming the go-to solution for businesses looking to streamline their M&A process. Here are just a few of the benefits that AI due diligence can offer:

Increased speed

As mentioned, one of the key benefits of AI is its ability to speed up the M&A process by automating tasks that would traditionally be carried out by a team of humans and take months to do.

Improved accuracy

With AI, businesses can gain a more accurate and comprehensive understanding of a target company. AI is not subject to human error or bias, meaning the insights it provides are generally more reliable.

A word of warning: not all AI assessment tools are equally accurate. When choosing an AI tool for your business, make sure to do your research and select a tool that has been created with data researchers and analysts, and is regularly updated with improvements.

Competitive advantage

Firms are fast-adopting AI for due diligence, but it’s still in its early stages. Compared to other industries, M&A has been comparatively slow when it comes to AI adoption. For now, this presents a unique opportunity for businesses to gain a competitive advantage by using AI due diligence in their M&A process.

Cost savings

Not only do AI due diligence tools automate tasks that would traditionally be carried out by a team of analysts, but they will also do so more accurately and quickly.

Applications

Here’s a rundown of a few of the key areas of use for AI due diligence.

Compliance and risk assessment

One of the most important elements of AI due diligence is compliance and risk assessment. By using AI to automate this task, businesses can quickly identify any potential risks associated with a target company. This includes financial risks, regulatory risks, and reputational risks.

Competitive analysis

In a highly competitive industry, it’s essential to have a clear understanding of your competitors. AI can be used to quickly gather and process information on your competitors, their strategies, their products, and their financials. This will give you a clear picture of the competitive landscape and allow you to make informed decisions about your own strategy.

Brand health

At a time when the reputation of a company is more important than ever, it’s essential to assess the health of a target company’s brand before making an acquisition. AI can be used to quickly gather and process data on a target company’s social media presence, its customer sentiment, and media coverage.

This will give you a clear picture of the company’s reputation and allow you to make an informed decision about whether or not to proceed with the acquisition.

Introducing Symanto AI

Symanto is a leading provider of AI-powered tools, specialising in commercial due diligence. Our tools and services are designed to help businesses streamline their M&A process and make informed decisions about potential acquisitions. This is done by assessing brand health and conducting competitive analysis based on what customers and employees say about the target brand and its competitors.

Our world-leading NLP models bring you the most accurate and up-to-date insights into a target company. Using our AI-powered tools, we offer a full brand health and due diligence report with the option for insights from our data analysts to help you make the most of your data.

Get Started With Symanto

If you’re looking for a competitive advantage in your M&A process, get in touch to learn more about our services for fast, accurate and reliable AI due diligence.

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