What buyers actually check first
Before anyone reads the growth story, they test whether the numbers hold. Here is the order most buyers work in, and what breaks first.
Most sellers assume a buyer opens the deck and starts at the top. In practice, the first hour is spent testing whether the financials tie out. If they do not, everything after that is read with suspicion.
The tie-out test
Revenue in the model should match revenue in the P&L, which should match the tax return within an explainable range. When those three disagree without a bridge, the buyer stops reading and starts asking questions you do not want to answer live.
Add-backs get scrutinised, not accepted
Every add-back needs a document behind it. Owner compensation, one-time legal fees, personal expenses run through the business: each one is fine on its own, and each one needs a receipt. A schedule with support attached converts an argument into a line item.
Working capital is where value leaks
A clean trailing twelve months of working capital, presented before the buyer builds their own, sets the peg on your terms. Waiting until the LOI means negotiating against their assumptions instead of your data.
Get these three right and the rest of diligence moves faster, with fewer retrades.
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