Diligence Interviews Run on Three Scarce Resources: Time, Attention, and Trust

Too often we hear deal teams wonder why many management and SME calls are so perfunctory. Everyone shows up. Everyone asks questions. And yet the answers feel like they came out of a vending machine. We have worked with dozens of deal teams, and the pattern is pretty consistent. The quality of information you get out of diligence calls is usually a direct function of three of the scarcest resources people have. Those resources are time, attention, and trust. If you want better interviews, stop treating those three like they are free. Let us take it bird by bird: We will start with time.

On a transaction, it never feels like there is enough time. You are hopping from 30-minute call to 30-minute call, then into a two-hour management session, then back to another internal sync you “need” for coordination, data collection, and process management. Some of those meetings are necessary. A lot of them are just momentum theater. The end result is predictable: The documents that actually matter get shoved to late nights.

Since COVID pushed so much diligence remote, the meeting volume did not just go up. It metastasized. The calendar became the work. When time gets squeezed, people do what humans do: they start showing up physically and leaving mentally.

On one memorable deal, a junior PE “professional” was typing loudly with their mic open while the Target’s CEO was speaking. Click-click-click. The CEO asked politely if they could mute. It took four requests and a bunch of internal messages before it stopped. The tone of the CEO was understanding but annoyed and terse. The quality of responses for the next ten minutes declined. The reason it took four requests was not technical. It was behavioral. That junior deal team member was signed into the meeting but was not physically in the meeting. Their time was stretched thin, and their attention was somewhere else. They were probably chasing a document, finishing a summary, building a model, or responding to the last five pings. It all felt important to that junior, but it sent a signal to management that their time and effort were not important.

In the best case, a teammate or an advisor carries the call, drives it to an objective, and you avoid embarrassment. But there is a more expensive time-related failure that shows up all the time. We have been on deals where management discloses a real red flag in a diligence call. It is something you would want to surface fast, so you hang up and pick up the phone to call the client, but it takes a day or two to connect because everyone is stacked back-to-back. By the time you reach them, it is somehow the first they are hearing about it, despite attending the meeting. This is usually the moment someone says, “Wait, that’s all in the game and is literally why we hire diligence providers.” Fair. We will absorb the friction. That is part of the job and as advisors charge accordingly for it.

The more important question is what signal you are sending to the people you are trying to buy from when you are present-but-absent. Management teams are not dumb. Operators can tell in the first three minutes whether they are dealing with someone who is engaged or someone who is running a call like a checklist while multitasking. If you are half listening, you will get half answers.

Worse, the company’s owners and management start to form an impression of what partnership is going to look like after close. It is not just whether you are smart. It is whether you are respectful. It is whether you can focus. It is whether you are going to be a thought partner or a calendar bully with a capital structure.

Maybe that is fine in some situations; Everyone responds to incentives. Plenty of operators are loyal to the company for the paycheck and the options, and plenty of investors are optimizing for process completion rather than true investment insights. Be forewarned when your diligence sessions produce shallow responses if your behavior is advertising that you are not taking the conversation seriously. That brings us to the third bird.

Trust is not built by asking great questions. Trust is built by how you show up. Everyone on these calls, consciously or not, is running the same internal check. Can I trust you? You are asking it about management. They are asking it about you.

The fastest way to fail that test is to burn someone’s time while signaling you do not value it. If you want a management team to go beyond canned answers, you need to create conditions where it feels safe and worthwhile to do so. If you want them to explain the why behind decisions, you need to show them you are listening. That starts with attention.

We will be honest in saying that attention is no guarantee for results. We have had CFOs tell us the trend line is going up and to the right, when the data clearly shows the flight path of a pilot on a kamikaze mission. Not great, but at least we are aware. Aware of how they present, act, and sound when they are working hard to misdirect us. The misdirection is not very interesting unto itself. Those who conduct diligence for a living tend to ask their own mothers for secondary sources that validate their love for them. These are hazards of the job. When there is deception the questions we need to ask are about what they are covering up and why. The answer to those questions help inform your conviction in the thesis and what you can expect of management post close, but only if you are present and looking for them.

When we run diligence meetings, we treat time and attention like scarce assets because they are. A few habits consistently change outcomes.

▪ Set primary objectives. Not ten. One or two. Decide what you need to learn on the call.

▪ Script the questions that matter. Do not read them like a robot. Use them to avoid wasting time circling.

▪ Order questions by magnitude of importance. If the call blows up at minute 28, you still get the big rocks.

▪ Assign roles. Use one driver and one note-taker. If you are the note-taker, go mic-off and stay out of the conversational lane.

▪ Ease in before you press. Do not start with the hardest questions unless you want defensive answers. Trust has to be established before you get to ask the hard ones.

Doing this does not guarantee you will not still get a reflexive non-answer. You may still hear “it is a third, a third, third,” “it depends,” or “we will follow up,” especially on topics like cost allocation or customer segmentation. The secret is that the path to better answers usually is not sharper questions. It is better allocating time and attention to engender trust.

When you demonstrate focus, you build rapport. When you build rapport, you can engender greater trust by showing enthusiasm for your work and their business. This requires curiosity about the job at hand. Curiosity did not kill the cat, but it has won over many hearts and minds. When you earn trust, you earn the right to ask more detailed and difficult questions. If you do it well, you sometimes give five or ten minutes back to everyone’s day. That sounds small. It is not. In diligence, the scarcest resources are not the ones in the spreadsheet. They are the ones sitting on the call.