The Due Diligence That Saved a Buyer $1.5M on an Acquisition

The Challenge

A SaaS founder was preparing to acquire an e-commerce brand. The seller demanded a 3.5M purchase price, citing a standard 4x multiple on a reported trailing-twelve-month EBITDA of 900k. The buyer needed rigorous financial due diligence before signing.

What We Did

We stress-tested the seller's financials and uncovered a critical hidden formula error: the seller had calculated their highest-cost recent months using expense data from the prior year. We rebuilt the financial model with correct logic — exposing the true EBITDA as 450k, exactly half of what was claimed.

The Result

• Revealed the target's true valuation was 50% lower than the asking price.
• Gave the buyer hard, defensible leverage in negotiations.
• Saved the buyer roughly 1.5M on the final purchase price.