Provided diligence services to a developer of education content

Provided diligence services to a developer of education content

Stout provided buy-side financial and tax due diligence services to a venture-capital-backed company. The target business was a creator of educational content, including lesson plans, crafts, and other curriculum for preschool-aged kids under a subscription plan model.

The Stout Financial Due Diligence team performed quality-of-earnings analysis, net-working-capital procedures, and net debt. The diligence included cash-to-accrual accounting analysis and customer retention analysis based on the subscription service model. Stout assisted the buyer throughout the process, including support with the financial terms and definitions in the purchase agreement.

Stout performed tax due diligence on the acquisition. These services included key analysis and steps around the S-Corp election, owner compensation, state and local tax filings, sales and use tax, and more.