[Lai Jiahui Joanne]

There are a few red flags:
1) Non compliance to laws, licenses, IP, tax laws
2) Violations to laws (eg tax evasion)
3) Huge liabilities
4) Litigation

[Cody Eberhardt]

The phrase “don’t ask don’t tell”, when doing due diligence and there is a legal requirement for something with customers but the target company says they customers/partners haven’t asked if we have that so we won’t tell them we don’t.

[Diego Kuonen]

Our primary red flags were related to land rights. Whenever feasible, we addressed these concerns by incorporating warranties into the contract.

[Mohammed Abdulmohsen Mohammed Alfozan]

In due diligence, the biggest red flags include financial inconsistencies, unresolved legal issues, and signs of non-compliance with regulations. A red flag becomes a showstopper if it poses a significant legal or financial threat that cannot be mitigated. If the issue can be addressed through negotiations or adjustments in the deal terms, it’s more of a challenge than a dealbreaker.

[Della]

I think some of the biggest red flags are undisclosed potential litigation, HR issues and potential director liabilities.

[Author]

Posts