The standard merger and acquisition course of is sluggish and costly, even for the biggest and best-resourced non-public fairness companies. Along with spending numerous hours assembly with potential targets’ senior executives and modeling monetary outcomes, these teams spend thousands and thousands of {dollars} on outdoors advisors reminiscent of accountants, attorneys, and administration consultants.
If a deal falls via, exterior advisor charges aren’t reimbursed, so PE companies wait till curiosity is for certain earlier than hiring costly consultants reminiscent of consultants from McKinsey, BCG and Bain to conduct in depth business analysis in the marketplace and goal firm.
Startup DiligenceSquared, a part of YC’s Fall 2025 cohort, says that with the assistance of AI, it might ship top-notch, consulting-quality business analysis at a fraction of conventional prices.
The startup’s co-founders Frederik Hansen and Soren Biltoft have deep experience in non-public fairness due diligence. Mr. Hansen beforehand served as president of Blackstone and commissioned these experiences on multibillion-dollar acquisitions. In the meantime, Mr. Biltoft spent seven years in BCG’s non-public fairness observe, main this sort of diligent effort.
Since launching in October, Hansen and Biltoft’s business expertise has helped DiligenceSquared full a number of tasks for a few of the world’s largest PE companies and mid-market funds, Hansen advised TechCrunch.
This early traction satisfied former Index Ventures accomplice Damir Becirovic to guide DiligenceSquared’s $5 million seed spherical from his new VC agency. Merciless.
As a substitute of counting on costly administration consultants, the startup makes use of AI voice brokers to conduct interviews with prospects of corporations that PE companies are contemplating buying.
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DiligenceSquared helps Keplar, Outset, listen labwhich raised $69 million in January at a valuation of $500 million. However Hansen and Biltoft argue that their due diligence course of and finish product is basically completely different from the buyer analysis these startups do.
Hansen mentioned PE companies pays McKinsey, Bain or BCG $500,000 to $1 million to interview dozens of company shoppers, together with executives, and produce a 200-page report that integrates these insights with proprietary market information. To make sure the standard of the evaluation, DiligenceSquared engages senior human consultants who confirm the accuracy and business perception of the ultimate output.
With AI doing a lot of the groundwork, the startup claims it might present analytics for as little as $50,000.
“We’re taking these nice insights that have been beforehand reserved for making essential selections and now making them extra accessible,” Hansen mentioned. Due to the low value, PE companies at the moment are far more prepared to have interaction with DiligenceSquared earlier within the course of, lengthy earlier than they’ve a powerful conviction for a deal.
DiligenceSquared is not the one firm making an attempt to disrupt the Diligence market. Its predominant competitor, Bridgetown Analysis, raised $19 million in Sequence A co-led by Accel and Lightspeed in February 2026.
Along with Hansen and Biltoft, DiligenceSquared was co-founded by Harshil Rastogi, a former Google engineer.
