Notes from a nine-figure diligence
Most veterinary software founders have never been through commercial due diligence. When they finally are, it's usually too late to change what the buyer finds.
I recently completed commercial due diligence advisory to a top-three global animal health corporate on a nine-figure acquisition in the veterinary software space, covering target financials, business model, platform assessment, and global market positioning. A few things stand out from that kind of work, and they're worth sharing because founders are usually building blind to them.
Buyers don't assess your product the way you do.
They look at whether the revenue is real, whether it's sticky, and whether the platform can carry weight it was never designed to carry. Growth gets pulled apart line by line. New logos versus expansion. Which expansion lines are operationally credible and which are wishful. A model that stacks every possible revenue stream to hit a number tends to get fragile under questioning.
Payments tends to be the most credible expansion line, because once it's embedded it's genuinely sticky. AI is more nuanced. Adoption is climbing, but most of that adoption is going to third-party scribes, not native PMS features. Standalone tools move faster because AI is their only focus. Native AI inside a PMS shares a roadmap with scheduling, billing, inventory and everything else. Founders forecasting native AI as a major revenue driver get challenged on this, because the data is increasingly showing where vets are actually going.
Migration capacity gets scrutinised as a real constraint. When growth ambitions get plotted against realistic onboarding capacity, the gap is usually where the unacknowledged churn hides. Sales targets that outrun onboarding capacity show later as exactly that, plus reputation damage. Buyers know this and they model it.
Support gets assessed as an economic function. PMS platforms sit inside daily clinical operations, so it isn't how big the support team is today. It's how the ratio holds when the installed base doubles. The gap between what sales has been promising and what the product actually does gets attention too. Roadmap-dependent revenue is a real line item in diligence, and it gets discounted accordingly.
The pattern across all of it is the same. Decisions a founder made in year two, often without realising they were strategic, show up loudly in year seven when someone is writing a nine-figure cheque.
If you're building veterinary software with any ambition of an exit, the work to make yourself acquirable starts long before a buyer ever calls.
It starts with the discipline of building like someone will eventually look under the bonnet.