Technical due diligence costs money. But the value it delivers—in risk avoidance, negotiation leverage, and integration planning—typically exceeds the investment by 10-50x.
TDD Cost Structure
- Rapid Assessment: $25K-$50K (1-2 weeks)
- Standard Assessment: $75K-$150K (3-4 weeks)
- Comprehensive Assessment: $150K-$300K (6-8 weeks)
- Enterprise Assessment: $300K-$500K+ (8-12 weeks)
Value Creation Sources
1. Purchase Price Adjustment
Average adjustment: 5-15% of deal value
- Technical debt quantification
- Security remediation costs
- Integration complexity
- Infrastructure modernization needs
2. Risk Avoidance
Value: Priceless when it matters
- Deal-killing issues identified
- Security breaches avoided
- Compliance penalties prevented
- Integration failures averted
3. Integration Acceleration
Value: 3-6 months faster integration
- Pre-planned integration roadmap
- Early stakeholder alignment
- Day 1 readiness
- Faster synergy realization
4. Negotiation Leverage
Value: Better deal terms
- Escrow provisions
- Seller remediation requirements
- Warranty coverage
- Earnout adjustments
ROI Calculation Example
$100M deal with $150K TDD investment:
- Purchase price adjustment: $3M (3%)
- Avoided remediation surprise: $2M
- Accelerated integration value: $1M
- Total value: $6M
- ROI: 40x
Key Takeaway: TDD is not a cost—it's an investment with measurable returns. The question isn't whether you can afford TDD; it's whether you can afford not to do it.