September 21, 2024
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3 min read
Streamlining Financial Due Diligence with EC Analytics
Ian Mason, former Corporate Director of Technology and Media at NatWest, spoke at Evolution Capital's FDD Forum in London, showcasing how EC Analytics is revolutionising financial due diligence for private equity investors and trade buyers. His key message was the importance of precise, data-driven insights to support informed decision-making in today’s fast-paced investment environment.
Confidence in Recurring Revenue and EBITDA Structure
Mason outlined the importance of having confidence in a business’s financials, particularly its recurring revenue and EBITDA structure. He explained, “We want to know that the business we’re looking at has a repeatable cash flow or structuring EBITDA that we can really wrap the number around. Do we have confidence in it?” For banks and investors, this level of financial transparency is essential.
Mitigating Risk and Uncovering Issues Early
One of the platform’s key strengths is risk mitigation. EC Analytics identifies potential risks and issues early, providing clarity in financial data for credit committees and stakeholders who may not be experts in specific sectors. Mason emphasised how the platform helps "bring to life the information that satisfies a credit officer who might not be an expert in digital infrastructure."
Interactive and Iterative Process
Mason praised the interactive nature of EC Analytics, particularly its ability to support an iterative process. He noted that the platform allows users to revisit specific concerns and tailor analyses to investor or lender needs: "If you go back into a tool and it shows me the information that this particular officer has a real issue with, that’s very powerful."
An Insurance Policy for Investors
In addition to its analytical capabilities, Mason described EC Analytics as a form of assurance for stakeholders. “For us, it's like an insurance policy... It's not just me that likes it, it's external analysis that’s saying the same thing and it’s good,” he explained. This external validation bolsters confidence in the financial health of target businesses.
Conclusion: A Must-Have Tool for Today’s Competitive Market
Mason’s endorsement of EC Analytics at the forum reflects the growing need for advanced financial tools that provide clarity and reduce risk. The platform’s ability to streamline due diligence processes, mitigate risks, and improve decision-making makes it invaluable for PE investors and trade buyers alike.
