The end of Deal Click Anxiety
By ansaradaMon Jul 30 2018Mergers and Acquisitions, Due Diligence, Capital raising
Allow me to set the sceneDue diligence is underway. You’re spending most of your work days – and nights, and weekends – in your data room, online. But this is no lengthy solitaire session. Every click represents a critical action or decision. One wrong move, and you could jeopardize the entire deal. And it’s not just the deal at stake; with each click, you’re gambling with your client’s business as well as your own reputation and livelihood. So you go about your work carefully, painstakingly reviewing documents and security settings, and enabling access for the right people. You spend hours cross-referencing and double checking to make sure every click is the right one. The days go by, and pressure mounts to a highpoint. You briefly ponder what your life might have been like as a professional greeting card writer. At this point, control you have over those critical clicks starts to decline significantly. You’re overworked, overtired, and ‘over it’ in general.
Sound familiar?The diagnosis is DCA, and it’s no way for anyone to work. Besides the blatant toll DCA takes on your mental and physical health, it’s also impossible to maintain vigilance. Double checking quickly turns into second guessing, and things slip through the cracks. And we see the suffering firsthand. With our backend view, we see all the duplicate accounts being set up as tests within our Data Rooms - evidence of the extra and unnecessary work that chronic DCA patients put themselves through.
DCA is a symptom of a much more serious conditionDeal Click Anxiety is the precursor to failed deals, failed businesses, and failed reputations, at all levels of the deal team. We recognize major transactions can cause uncertainty and anxiety - and not just for the principals negotiating the terms and the advisors managing the deal. DCA has a knock-on effect for employees of the business, who are often critical to its future success. Employees will ask: Who will buy us? Will they impose change and, if so, what and when?
Minor mistakes, major catastrophesRecently, an experience was shared with us by a former employee of a business, whose assets were being auctioned. The identity of the bidders accessing the data room was protected by a code name. Towards the end of a protracted due diligence and publicly reported process, only two bidders remained. However, the identity of one was revealed, as the security feature offered by the code name failed. No longer protected by a code name, the bidder asked final direct questions about employees’ statutory rights. This disclosure could be viewed by all those who had access to the data room. This had a direct and material impact, with key employees choosing to resign and profoundly affecting the success of the asset sale. Regardless of who on your team is experiencing DCA, it will have the same impact; it’s an early warning sign that you’re taking on far too much risk. Everything you’ve worked hard to build throughout your career is certainly not worth the gamble. So why the hell do we keep doing it? This was one of the big questions we asked ourselves two years ago, when we embarked on a journey to build the next generation of deal technology to completely safeguard the way people, information, and security work in our data rooms.
Until now, data rooms have never been safeWe looked at more than 20,000 deals to understand the common mistakes that people make, and we heard all the stories. Everything from accidentally giving someone the wrong access to confidential documents, to forgetting to set security completely. Armed with these insights, we set out to re-engineer our data room from the ground up to make sure errors, fear, anxiety and wasted time agonizing over them were removed. Your DCA, gone for good. You may remember our fearless leader, Sam Riley, boldly predicting the death of the traditional data room back in June of last year, with the launch of the game-changing Material Information Platform imminent. Well, the latest upgrade is the final nail in its coffin.
|“Screwups shouldn’t be an accepted part of the due diligence process.” – Ansarada CEO Sam Riley|