Due Diligence Has to Be Done. The Traditional Way Falls Short.

Up to $3,400 an hour for a top partner at the largest firms. 203 days. Thousands of documents, read one page at a time. Welcome to due diligence: one of the most expensive reading assignments in business.

Before a company is bought, the buyer checks it: its contracts, finances, legal exposure, technology, and people.

Let's look at diligence from the buyer's side, in four parts: what you pay, how long you wait, who you hire, and what they do. Then comes the part most buyers never see: why the traditional way of doing it falls short.

What It Costs

Much of the cost is people's time, billed by the hour, and that time keeps getting more expensive. Some senior partners at the largest US law firms now charge as much as $3,400 an hour, the ABA Journal reported in February 2026, citing the Wall Street Journal and data from Persuit, a company whose software in-house lawyers use to analyze their legal bills. A little over a year earlier, the going rate for a top lawyer was about $2,500. Rates for partners at the 50 largest firms rose 16 percent on average in 2025.

At $3,400 an hour, 100 hours of a senior partner's time comes to $340,000.

Specialist reviews add more. A standard technology review alone costs about €20,000 to €30,000, and from €30,000 to more than €50,000 for complex companies, according to VeryDiligent, a firm that performs them. Faster turnaround carries a premium, the firm adds, and missing documents or slow responses from the company being bought stretch the timeline and raise the bill. Financial, tax, and other reviews are priced separately. VeryDiligent argues that the price should be weighed against the cost of skipping the review. A €20,000 review that uncovers a €200,000 problem, it writes, "is not a cost. It is a return on investment." On that it is right.

Diligence is worth doing. But the traditional way of doing it is the problem. To see why, start with how the work gets done: how long it takes, who does it, and the steps it follows.

How Long It Takes

A study by Bayes Business School for SS&C Intralinks, covering more than 900 deals, found that due diligence, measured from the opening of the data room to the public announcement of the deal, took an average of 203 days for deals announced between 2013 and 2023, up from 124 days in the school's 2013 analysis.

That is more than six months of fees and meetings before a deal is even announced, let alone closed. Longer is not better, either: the same study found that deals with medium-length diligence were more likely to complete than those with the shortest or longest reviews. What matters is not how much time diligence takes, but how that time is spent.

Who Does the Work

A typical review pulls in several teams at once:

• Lawyers review contracts, litigation, intellectual property, employment, and regulatory issues
• Accountants test the financial statements and the quality of the company's earnings
• Tax advisers review tax exposure
• Technology specialists review software, security, and systems
• The buyer's deal team coordinates the work and decides what the findings mean for the price

Each team works from the same documents but writes its own report.

How the Process Works

1. The seller opens a data room: an online folder holding hundreds or thousands of documents.
2. The buyer's teams send request lists for anything missing.
3. Reviewers read the documents one at a time against a checklist.
4. Findings go into memos and a diligence report.
5. Lawyers turn the findings into the purchase agreement: the seller's statements of fact about the business, known as representations and warranties; promises to cover specific losses, known as indemnities; and changes to the price.
6. The deal signs and closes.

Why the Traditional Way Falls Short

It is manual. Reviewers read page by page, under deadline. Expensive hours go to finding issues rather than judging them, and a document no one reached is a risk no one saw.

It goes out of date. New files land in the data room throughout the deal, and the agreement changes draft after draft. A checklist run on day one shows the data room as it looked on day one.

It is scattered. Each team's findings sit in its own report, yet the findings depend on each other. A customer contract the company can lose if it changes owners is a legal finding, but it also changes the revenue the accountants are counting and the price the buyer should pay. When the reports sit apart, connections like that can be missed. The reasons behind each change to the agreement sit in email and in people's memories.

Experienced deal lawyers would say they already connect these pieces, and the best do. But that connection lives in their heads and their inboxes. When they move to the next deal, or to another firm, it goes with them.

It stops at closing. Representations and warranties insurance, which many buyers now carry, pays out if the seller's statements prove untrue. Insurance broker Aon's 2026 claims study found that among its North American clients, about 51 percent of these claims were reported more than 12 months after closing, many after the seller's escrow, money held back to cover such claims, had expired.

The findings also matter for as long as the acquired company's contracts run. Diligence is the first stage of managing those contracts, what lawyers call the contract lifecycle, not the last. And integration brings its own questions, whether in a corporate merger or a private equity add-on. By then the deal team has often moved on, and the buyer has to rebuild the story from old reports and emails, paying again for knowledge it already bought.

A buyer has two needs, not one: a present need to decide whether to buy, and a future need to understand what it owns. The traditional way serves mainly the first.

How Aracor Does It Differently

Aracor is one platform built for the deal, designed by people who have lived these problems, a team that has closed multibillion-dollar transactions and worked in more than 20 countries. Among them: a former co-chairman of one of the world's leading law firms, named a Dealmaker of the Year by The American Lawyer; a former co-head of private equity at another global firm; the founder of more than two dozen technology companies, with more than 350 patents to his name; and a chief executive who is a practicing attorney and has been on every side of the table, as a law firm partner, chief legal officer, and public company director. They built Aracor to solve the problems above, in the following ways:

• Every document reviewed. Aracor runs the diligence checklist against the entire data room in the background, based on the user's role in the deal: buy side, sell side, investor, or lender. It covers roughly 120 checks across legal, finance, intellectual property, regulatory, commercial, insurance, employment, and tax, using its default list or the firm's own.
• One picture, tied to evidence. Findings sit in one place, and each links to the document it came from. Risks are grouped by severity, and follow-up requests are tracked alongside them.
• Current as the deal moves. Aracor stays in sync with the data room, reruns the checklist as new documents arrive, and tracks each new version.
• A memo that writes from the work. The diligence memo is drafted from the findings, as a PDF or an editable Word file, instead of from a blank page.
• A record that outlasts closing. Documents, findings, and decisions stay in one continuously updated record, so post-close diligence and integration pick up where the deal left off.

The Bottom Line

Done the traditional way, diligence today means six months, a small army of specialists, and a bill with plenty of zeros. All of that should buy more than a report that goes on a shelf at closing.

Due diligence has to be done right. That means a map that keeps up with the deal's changing terrain. Aracor builds that map: every document reviewed, findings kept current and in one place, and the record carried past closing as post-close intelligence. One record that serves both of the buyer's needs - what it must know to decide whether to buy the company, and what it must keep knowing once it owns it.