A private equity due diligence checklist is really a resourcing plan, because no fund runs all of it internally. Six workstreams run in parallel after the LOI, a small fund keeps two of them and buys the rest, and how that split is made decides both the cost and the timetable. This page sets out the six, who normally does each, and where the coordination actually fails.
Kept in house: commercial and management
The thesis and the people. These are the two the fund cannot outsource without outsourcing its own judgement, and they are the two that decide whether the investment works. Advisers can supply market data; only the deal team can decide whether the plan is credible with this team running it.
Bought in: financial, tax, legal and technology
Quality of earnings from an accounting firm, tax structuring, legal on contracts and corporate, and a technical review where the product matters. All four are specialist, all four are priced per engagement, and all four will produce a report the committee reads rather than the deal team writes.
Where coordination fails
Four external workstreams each produce a finding that changes somebody else's work, and nobody owns the join. The classic version is legal finding a change-of-control clause that the commercial team had modelled as recurring revenue, three weeks after the model was built and one week before committee.
The cost that never appears
Chasing the seller for what all six workstreams need. On this site's worked example, 68.4 open requests chased at 0.4 hours a week over six weeks is 164.16 hours and $15,595.20 at $95 an hour, which is $228 per open request. That is the fund's own time, and it is invisible in every adviser quote.
Questions people ask about private equity due diligence checklist
What should a fund keep in house?
Commercial and management. Outsourcing either means outsourcing the judgement the investment depends on.
Where does diligence coordination fail?
At the joins between external workstreams, where one finding invalidates another team's work and nobody owns the connection.
What does the chasing cost the fund?
On the worked example, 164.16 hours and $15,595.20 across a list of 180 requests that is 62% answered.