What is Due Diligence?
Due diligence is essentially doing your homework before entering into a business agreement. It's the process of investigation and analysis that a company performs before making a big decision, like acquiring another company or forming a strategic partnership. The goal is to verify all the facts, assess any potential risks, and make sure the deal makes good business sense. This might involve reviewing financial records, legal contracts, and customer lists. For partnerships, both sides should conduct due diligence to ensure their goals and values are aligned.