Technology Value Drivers
Identifying and validating technology-based value creation
Beyond risk identification, TDD should validate the technology-based value drivers that justify the acquisition thesis.
Common Technology Value Drivers
1. Proprietary Technology
- Unique algorithms or IP
- Differentiated product capabilities
- Patents and trade secrets
- First-mover advantages
2. Data Assets
- Unique data sets
- Data network effects
- ML model training advantages
- Customer insights
3. Platform Economics
- Multi-sided platform dynamics
- Switching costs
- Integration ecosystem
- API-driven extensibility
4. Operational Efficiency
- Automation capabilities
- Scalability economics
- Self-service features
- Low marginal cost per user
Value Validation Questions
- Is the claimed proprietary technology truly unique?
- Can the technology advantage be sustained?
- Are the technical claims in marketing materials accurate?
- Is the technology team capable of continued innovation?
- What would it cost to replicate the technology?
Synergy Assessment
For strategic acquisitions, evaluate technology synergies:
- Revenue Synergies: Cross-sell opportunities, expanded capabilities
- Cost Synergies: Platform consolidation, shared infrastructure
- Technology Synergies: Combined capabilities, accelerated roadmap
Key Takeaway: TDD should validate value drivers, not just identify risks. Understanding technology strengths is as important as finding weaknesses.