Performing due diligence in times of Covid-19

At AvantFaire we value long-term relationships and forward-thinking business planning, and we therefore believe in keeping in touch with our partners on an ongoing basis. Since we work with institutions in several countries (the US, China, Singapore, Canada, New Zealand, Israel, and Switzerland just to name a few), we believe that these last few months have brought out the creativity and communication skills of all market participants. As far as AvantFaire’s experience is concerned, one example stands out where New Zealand’s international business development agency (the “New Zealand Trade and Enterprise”) was instrumental to connect us with talented entrepreneurs.

But coming to the core of this post, we are frequently asked “How do you go about performing due diligence during the Covid-19 pandemic?”

This is indeed a very legitimate question, as a thorough due diligence (DD) process is at the heart of what we do. At AvantFaire, we put a strong emphasis on “people” and “business” in our DD process, which include many different facets. In both areas of focus, the “tech tools” that we all have quickly become very familiar with in 2020 have been extremely helpful, as they allow us to keep discussions going with potential portfolio companies even in times of crisis. Technology has allowed AvantFaire to rise to the occasion in these difficult times, and perform high quality DDs in line with the best industry standards. We have rapidly adapted our processes to these new circumstances to ensure the same quality of DD is maintained, both in terms of frequency and depth of communications with our counterparties. In the meantime, we are continuously looking for new and creative solutions to fine-tune our processes.

For AvantFaire, one of the challenges of not being able to perform physical due diligence is that our team needs to collect more visual and digital information than in “normal times”. One may say that we have been transitioning from a DD process towards a Digital DD, a new type of process in which the creativity of the participants also has a role to play.