Due diligence questions: 60+ to ask when buying or investing in a business

Thinking carefully about what you are buying before committing is essential. This is what due diligence questions are designed to support. They structure how buyers, investors, and advisors assess a business before a deal is made. By guiding a systematic review of the company, they help determine the company’s value and the risks associated with the deal.

This guide brings together 60+ questions to ask during due diligence, organized by business area and deal type. Whether you’re buying a business, investing in one, or advising on a deal, you can quickly find what to ask.

In US M&A, 41% of professionals identify due diligence as a major deal-closing challenge, second only to valuation. Structure helps improve consistency in risk evaluation and decisions.

At a glance

◾ Due diligence questions structure how a business is reviewed across financial, legal, operational, and commercial areas before a transaction.

◾ Investment due diligence focuses on governance, strategy, and expected returns under shared ownership.

◾ Different deal types require different question sets, especially for technical, commercial, HR, IT, and supply chain risk.

◾ Virtual data rooms centralize documents and Q&A to improve control and efficiency during the process.

What is a due diligence questionnaire?

This is a document containing questions that a buyer, investor, or advisor sends to a target company to gather information before completing a transaction. It covers key business areas, including financial performance and legal compliance, allowing the buyer to identify risks and support decisions.

👁️‍🗨️ DDQ vs. due diligence checklist: Companies use DDQs to request detailed information and supporting documentation from the target company. A due diligence checklist, in turn, serves as an internal guide to ensure every area of the business is reviewed. Both help buyers conduct a thorough and organized evaluation.

The table below summarizes the main areas and questions covered during the target assessment process.

Due diligence checklist overview

Category	What it probes	Example question
Company information	🔸 Structure 🔸 Ownership 🔸 History	Who owns the company? What is its legal structure?
Financials	🔸 Performance 🔸 Margins 🔸 Debt 🔸 Tax	What do the last three years of audited statements show?
Products and services	🔸 Offering 🔸 Pricing 🔸 Roadmap	Which products drive the most revenue and margin?
Customers and sales	🔸 Customer concentration 🔸 Contracts 🔸 Churn	Who are the top customers? How concentrated is revenue?
Employees and HR	🔸 Key people 🔸 Employee contracts 🔸 Benefits	Which employees are critical? Will they stay?
Technology assets	🔸 Systems 🔸 Intellectual property 🔸 Security	What technology is owned vs. licensed?
Legal and regulatory compliance	🔸 Litigation 🔸 Licenses 🔸 Permits	Are there past or pending lawsuits or regulatory issues?
Intellectual property	🔸 Patents 🔸 Trademarks 🔸 Ownership	Is all IP properly owned and registered?

Due diligence questions to ask when buying a business

The questions below will help you evaluate the target company, identify risks, and make a more informed acquisition decision.

👁️‍🗨️ Things to know when conducting small business due diligence. Pay attention to owner dependence, undocumented processes, and key customer and supplier relationships. Critical knowledge and relationships often reside with the owner in small companies. This makes it essential to evaluate whether the organization can continue operating under new ownership.

1. Company information

✔ How does the company generate revenue?

✔ What is the business model?

✔ Who owns the business? How is ownership structured?

✔ Have there been changes in ownership, strategy, or corporate structure in recent years?

✔ Which markets does the company operate in? What is its competitive position?

✔ Does the business operate through subsidiaries, affiliates, or related-party entities?

✔ Who has authority over operational and strategic decisions?

✔ What are the key growth opportunities identified by management?

✔ What governance or ownership issues could impact the transaction?

2. Financial statements

✔ What do the last three to five years of financial statements reveal about revenue growth, profitability, and margin trends?

✔ Are the financial statements audited? Have accounting policies remained consistent over time?

✔ How are revenue streams structured? How diversified is the revenue base?

✔ What are the key cost drivers? How have they evolved?

✔ Have operating expenses remained stable or shown structural change?

✔ What debt, lease commitments, or contingent liabilities are in place?

✔ What is the target’s ability to generate sufficient operating cash flow to fund ongoing operations and growth?

✔ Are there any outstanding tax liabilities, audits, or other financial exposures?

Additional insights: See a financial due diligence checklist for a structured breakdown of financial performance, risks, and key assumptions.

3. Services and products

✔ Which products generate the most revenue and profit?

✔ What differentiates the offering from competitors?

✔ How have core product revenues changed over the past three to five years?

✔ Are any products approaching obsolescence or end-of-life?

✔ How is pricing determined? How often is it reviewed?

✔ What products are in development?

✔ How are new offerings expected to contribute to growth?

✔ Are there product quality issues, recalls, or recurring complaints?

✔ Is revenue concentrated in a single product?

4. Intellectual property

✔ What intellectual property does the company own, license, or use?

✔ Are patents, trademarks, copyrights, and domain names properly registered and owned?

✔ Which IP assets are critical to competitive advantage?

✔ Does the business rely on third-party IP or licensed technology?

✔ Do any licensing terms restrict use after acquisition?

✔ Do employment and contractor agreements assign IP rights to the company?

✔ How are trade secrets and confidential information protected?

✔ Has the company been involved in IP disputes or infringement claims?

5. Customers

✔ Who are the largest customers? What revenue share does each represent?

✔ What customer contract structures are in place?

✔ How has customer retention changed over time?

✔ Has the company lost key accounts or experienced material churn?

✔ How diversified is the customer base across industries and regions?

✔ Are key customer relationships dependent on specific individuals?

✔ What are the primary customer acquisition channels?

✔ How is customer satisfaction measured?

6. Employees

✔ Which employees are critical to operations?

✔ Are key employees covered by contracts or retention arrangements?

✔ What has employee turnover been over the past three to five years?

✔ Are compensation and benefits competitive in the market?

✔ Are incentive, bonus, or deferred compensation schemes in place?

✔ How dependent is the business on the current owner?

✔ Is there a succession plan for key roles?

✔ Are there skill gaps or hiring constraints?

7. Technology assets

✔ Which systems are essential to operations?

✔ Are systems owned, licensed, outsourced, or cloud-based?

✔ Who are the key technology vendors?

✔ How integrated are core systems?

✔ Does the business rely on legacy infrastructure or have significant technical debt?

✔ How are access controls and data security managed?

✔ What backup and disaster recovery processes are in place?

✔ Has the company experienced cybersecurity incidents or material vulnerabilities?

✔ How dependent is the business on external IT providers?

8. Legal status

✔ Has the company been involved in litigation, claims, or regulatory proceedings?

✔ Are all required licenses and permits current?

✔ Is the business compliant with applicable laws and regulations?

✔ Are there ongoing regulatory investigations or compliance breaches?

✔ Which contracts are material to the business?

✔ Do key contracts include change-of-control or termination provisions?

✔ Are there outstanding tax audits, liabilities, or legal disputes?

Additional insights: Check how findings are structured in a due diligence report to ensure risks, assumptions, and conclusions are clearly captured for decision-making.

Due diligence questions to ask when investing in a business

Your role as an investor is different from that of an outright acquisition. Instead of taking full operational control, you are evaluating how effectively the company will perform with your capital and whether management can deliver returns under shared ownership.

This makes investor-focused due diligence less about full integration planning and more about validating strategy, governance quality, and value creation potential.

1. Strategy and value creation

✔ What is the company’s core value creation thesis?

✔ How realistic are the projected growth assumptions? What drives them?

✔ What are the key levers for increasing revenue and margins?

✔ How concentrated is performance across customers, products, and markets?

2. Management and governance

✔ Who is responsible for key strategic and financial decisions?

✔ What is the management team’s track record in delivering investor returns?

✔ How are incentives aligned between management and investors?

✔ What governance and reporting structures are in place?

3. Financial performance and quality of earnings

✔ How stable and predictable are historical revenues and cash flow statements?

✔ What EBITDA adjustments are made? Are they justified?

✔ How much of earnings depend on one-off or non-recurring items?

✔ What does the working capital cycle look like?

4. Capital structure and returns

✔ What is the current ownership and capital structure?

✔ How is capital typically allocated across growth, dividends, and reinvestment?

✔ What returns are expected under base, upside, and downside cases?

✔ What exit options are realistically available?

5. Risk factors

✔ What are the main operational, market, and regulatory risks?

✔ How exposed is the business to macroeconomic fluctuations?

✔ What factors could most materially undermine the investment thesis?

✔ How resilient is the business under stress conditions?

Additional insights: See red-flag due diligence for a deeper view of identifying critical risks early in the process.

Due diligence questions by type

Each layer of a business tells a different part of the story. This section breaks due diligence into core domains so you can focus on what matters most in each area.

1. Technical due diligence questions

Technical DD focuses on how the product is built, how stable it is, and whether it can scale. It also looks at security and the engineering team’s strength. This is especially important in software-heavy or tech-enabled businesses.

✔ How is the system architecture designed?

✔ Is the architecture scalable?

✔ How is the codebase structured and documented?

✔ What is the level of technical debt?

✔ What are the key security controls in place?

✔ Has the company experienced security incidents or breaches?

✔ What is the composition and capability of the engineering team?

✔ How is software quality tested and maintained?

2. Commercial due diligence questions

This due diligence evaluates how the business competes, grows, and sustains demand. It focuses on the external market environment and the company’s position within it.

✔ What is the company’s target market?

✔ What is the company’s current market share? How has it changed over time?

✔ Who are the key competitors?

✔ What are the main competitive advantages?

✔ How has revenue grown over time?

✔ What are the primary growth drivers?

✔ What are the main barriers to entry in the market?

✔ How sensitive is demand to price or macroeconomic changes?

3. HR due diligence questions

HR due diligence examines the workforce structure, retention risks, and cultural stability. People are often one of the largest hidden risks in a transaction. For example, a business may look operationally strong on paper, but rely heavily on a small group of key employees whose departure would disrupt performance or continuity.

✔ Which roles are critical to business continuity?

✔ What is the employee turnover rate?

✔ What is the employee retention trend?

✔ What employment contracts are in place for key staff?

✔ What incentive or bonus structures exist?

✔ How dependent is the business on specific individuals?

✔ Is there a succession plan for key roles?

✔ How would you describe the organizational culture?

4. IT, software, and vendor due diligence questions

This area focuses on systems, external dependencies, and operational resilience. It includes both internal IT infrastructure and third-party vendor relationships.

✔ Which systems are core to business operations?

✔ Which systems are owned versus licensed or outsourced?

✔ What are the key third-party software vendors?

✔ What service level agreements (SLAs) are in place?

✔ How integrated are core systems such as CRM, ERP, and finance tools?

✔ What backup and disaster recovery processes exist?

✔ How is data access controlled and monitored?

✔ What is the level of dependency on external IT providers?

5. Supply chain due diligence questions

Supply chain due diligence assesses operational continuity and exposure to external disruptions. It is especially important for manufacturing, distribution, and product-based businesses.

✔ Who are the key suppliers?

✔ How concentrated is the supplier base?

✔ How dependent is the business on single-source suppliers?

✔ What are the key supplier contract terms?

✔ What is the average supplier relationship duration?

✔ Are there alternative suppliers available?

✔ How resilient is the supply chain to disruption?

✔ What logistics or distribution partners are used?

The following table breaks down each DD type by its core focus and includes representative sample questions to help clarify scope, reduce ambiguity, and ensure consistent analysis across all key areas.

Due diligence question by type overview

Due diligence type	Focus	Sample questions
Technical	Code quality, architecture, security, tech debt	Is the architecture scalable? How is the codebase documented?
Commercial	Market position, customers, competitors, growth	What is the company’s market share and how is it trending?
HR/people	Key staff, contracts, culture, retention	Which roles are critical, and what is the attrition risk?
IT/software and vendor	Systems, licenses, third-party risk	Which systems are owned vs. licensed, and what are the SLAs?
Supply chain	Suppliers, dependencies, continuity	How concentrated and resilient is the supplier base?

To keep due diligence organized at scale, teams use dedicated platforms that centralize communication and documentation.

How a virtual data room streamlines due diligence Q&A

A virtual data room (VDR) is a secure platform for storing, sharing, and managing sensitive information during a transaction. During due diligence, it serves as the central hub where buyers, investors, and advisors review documents, submit DD questions, and exchange answers within a controlled, auditable environment. Instead of scattered emails and file versions, everything is organized in one place with clear permissions and full visibility over activity.

Check the key virtual data room functionalities for due diligence and how they change the process:

Functionality	What it does	Why it matters in due diligence
Q&A module	Centralizes submission and resolution of questions	Keeps all due diligence questions and answers structured and trackable
Document repository	Stores all transaction documents in one secure location	Ensures all parties work from a single source of truth
Access permissions	Controls who can view, edit, and download specific files	Protects sensitive data and reduces data leakage risk
Full-text search	Enables fast search across all documents and Q&A history	Speeds up information retrieval during tight deal timelines
Audit trail	Records all user activity and document interactions	Provides transparency and accountability throughout the process
Version control	Tracks updates and maintains document history	Prevents confusion from outdated or conflicting files
Activity tracking	Shows what documents are being viewed and by whom	Helps sellers understand buyer interest and focus areas
Data room checklist	Defines and organizes all key features and requirements of the data room in one structured list	Ensures nothing is missed when setting up or managing the due diligence environment

These VDR capabilities turn business diligence from a fragmented exchange of emails into a structured workflow where every question and answer is traceable, secure, and easy to manage.

A curated overview of data room providers here can help identify tools that best support efficient due diligence processes and improve the management of due diligence questions and answers.

Key takeaways

• Due diligence questions structure how an acquiring company, investor, or advisor evaluates a business before a transaction, covering value, risk, and key assumptions.
• DDQs and checklists ensure consistent information gathering across financial, operational, legal, commercial, technology, and intellectual property areas.
• Investment due diligence focuses on governance, strategy, capital allocation, and expected returns under shared ownership.
• Financial, commercial, and operational analysis tests earnings quality, market position, and business resilience beyond reported figures.
• Virtual data rooms centralize documents, Q&A, and tracking, keeping due diligence structured, secure, and auditable.

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