Deal Red Flags Checklist
intermediateSystematic checklist to identify red flags in business deals before committing.
When to use this:
- •Pre-investment due diligence
- •Evaluating acquisition target
- •Considering major partnership
~12 min•8 questions
Framework Details
Category
Financial DecisionsDifficulty
intermediateEstimated Time
~12 minutes
When to Use This
- •Pre-investment due diligence
- •Evaluating acquisition target
- •Considering major partnership
- •Team is enthusiastic but you're uneasy
- •High-pressure sales tactics
Warning Signs
- •Past auditor/legal relationships that ended badly
- •Frequent executive turnover
- •Litigation history with customers or partners
- •Evasive answers about "why now"
- •References are all from long ago
- •Key person is unusually charismatic (manipulation risk)