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Commercial Due Diligence: investment decisions in the fermentation sector

Project request

Our client, a leading global investment fund, approached us for commercial due diligence on a potential 8-digit EUR investment. The focus was on a target specializing in fermentation.

We conducted a 4-week comprehensive commercial due diligence on the target with our consulting and expert team. We leveraged our standard commercial due diligence frameworks and tailored this to the investors’ needs and target situation.

Our commercial analysis encompassed an in-depth review of the fermentation sector, focusing on market size, growth drivers, the competitive environment, and commercial viability, including a detailed examination of the target’s business model.

Key components:

  • Market size & growth drivers: Analysis of the fermentation market by ingredient and facility type, current capacity, and demand forecasts, differentiating between own capacity and that provided by target.
  • Competitors: Evaluation of the top three competitors, focusing on business models, technology, sustainability, financing, scale, integration, and partnerships.
  • Pricing & utilization: Benchmarks for pricing and utilization specifically for food fermentation and other targets.
  • Commercial feasibility: Inclusion of the business plan, unit economics, growth drivers, and the foundational commercial & technical assumptions.
  • Business model: Analysis of the target’s business model against various target industry practices.
  • IP & regulatory: Examination of IP status, its relevance to the business model, and regulatory and incentive frameworks within the target’s geography.
  • Commercial team: Assessment of the key commercial team members, focusing on background, qualifications, experience, and their capacity to execute the business plan.
  • Pipeline: Evaluation of the quality of the target's existing and potential customers and projects.

Our methodology

Our project team, consisting of one Project Manager, two Consultants and one Technical Lead, leveraged our in-house knowledge base and extensive network of over 2000 global experts. In addition, management interviews and desk research enabled us to challenge the data room. In most of our due diligence projects, we also perform a site visit.

Our unique combination of both classical due diligence approaches and deliverables, together with in-depth market understanding and expert views, have been combined in a final deliverable of a detailed DD report and an executive summary for the Investment Committee.

Project deliverable

The evaluation offered the client an in-depth understanding of the investment opportunity and associated risks. Our insights will inform the fund’s decision-making, while the overall investment is currently still being assessed and to be presented to the Investment Committee.

For more information on our services and how we can support you on informed investment decisions, please contact us.
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