A typical merger-and-acquisition course of is time-consuming and costly, even for the biggest, well-staffed personal fairness companies. Along with spending numerous hours assembly with senior executives of potential targets and modeling monetary outcomes, these teams spend thousands and thousands of {dollars} on exterior advisers: accountants, legal professionals, and administration consultants.
Since bills for exterior advisers will not be reimbursed if a deal falls via, PE companies wait till they’re sure of their curiosity earlier than participating pricey specialists resembling consultants from McKinsey, BCG, or Bain to carry out in depth industrial analysis available on the market and the goal firm.
DiligenceSquared, a startup that was a part of YC’s Fall 2025 cohort, says that with the assistance of AI, it may well present top-tier consultancy-quality industrial analysis at a fraction of the normal value.
The startup’s co-founders, Frederik Hansen and Søren Biltoft, possess deep experience in personal fairness due diligence. Hansen was previously a principal at Blackstone, the place he commissioned these reviews for a number of billion-dollar buyouts. In the meantime, Biltoft spent seven years in BCG’s personal fairness apply main these kind of diligence efforts.
Since launching in October, Hansen’s and Biltoft’s trade expertise has helped DiligenceSquared full a number of tasks for a number of of the world’s largest PE companies and mid-market funds, Hansen tells TechCrunch.
That early traction satisfied Damir Becirovic, a former Index Ventures accomplice, to steer DiligenceSquared’s $5 million seed spherical out of his new VC agency, Relentless.
As an alternative of counting on costly administration consultants, the startup makes use of AI voice brokers to conduct interviews with prospects of the businesses the PE companies are contemplating shopping for.
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DiligenceSquared is making use of the identical AI-interview mannequin seen in shopper analysis startups like Keplar, Outset, and Listen Labs, which in January raised $69 million at a $500 million valuation. However Hansen and Biltoft argue that their due-diligence course of and ultimate outputs are essentially completely different from the patron analysis produced by these startups.
PE companies pays $500,000 to $1 million for McKinsey, Bain, or BCG to interview dozens of company prospects, together with C-suite executives, and produce 200-page reviews synthesizing these insights with proprietary market information, Hansen mentioned. To make sure the standard of the evaluation, DiligenceSquared includes senior human consultants who confirm the accuracy and industrial insights of the ultimate output.
Since AI is doing plenty of the groundwork, the startup claims it may well present the evaluation for simply $50,000.
“We’re taking these nice insights that have been beforehand reserved for the very massive selections, and now we make them extra accessible,” Hansen mentioned. Due to the cheaper price level, PE companies are actually way more prepared to interact DiligenceSquared earlier within the course of, nicely earlier than they’ve excessive conviction in a deal.
DiligenceSquared isn’t the one firm making an attempt to disrupt the diligence market. Its major competitor, Bridgetown Research, raised a $19 million Collection 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.
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