We are conducting a code audit of a potential acquisition. Who performs technical due diligence?

For a software/technology acquisition, technical due diligence (TDD) is usually performed by an independent technology specialist, often working alongside the buyer’s internal CTO/engineering team and the broader M&A diligence team.

Typical providers are:

• Specialized technical due-diligence firms — independent software architects/engineers who assess the target's code, architecture, scalability, security, technical debt, infrastructure, and engineering practices.
• Technology consulting firms — larger consultancies can conduct a broader technology assessment, particularly for complex enterprises or regulated businesses.
• Cybersecurity/code-audit specialists — useful when the primary concern is source-code security, vulnerabilities, open-source licensing, SBOM/dependencies, or IP exposure.
• The buyer's internal CTO/VP Engineering team — common for strategic acquirers with substantial technical expertise. They may do the overall assessment and bring in an outside specialist for an independent code/security review.
• A trusted independent CTO/engineering team — sometimes used for smaller acquisitions, but they should have genuine M&A/code-audit experience rather than simply doing a conventional code review.

For your code audit specifically

I'd distinguish technical due diligence from a code audit:

A good TDD engagement isn't merely someone looking through the GitHub repository. The assessment should connect code findings to architecture, security, team dependency, scalability, remediation cost, and ultimately the acquisition decision.

If you're the buyer conducting the acquisition, I would generally recommend having an independent third party lead the technical diligence, with your CTO/engineering team participating. That gives you both an expert assessment and some independence from the deal's internal enthusiasm.

If you tell me whether this is a SaaS/software company, an IT services company, or a broader business with software as one asset, I can give you a recommended TDD team structure and a practical code-audit checklist for the acquisition.

Technical due diligence—especially a code audit during an acquisition—is typically a collaborative effort. Depending on the size of the deal, budget, and internal capabilities, the assessment is performed by a mix of internal stakeholders and specialized external professionals.

Here is a breakdown of who typically performs the technical due diligence and code audit:

• External Technical Due Diligence Consultants: Specialized boutique firms, independent software engineering consultants, or major accounting/consulting firms (e.g., Deloitte, PwC) are frequently hired to provide an independent, objective evaluation of the codebase, architecture, and engineering team.
• Internal Engineering Leadership: The acquiring company's CTO, VP of Engineering, or Principal Architects often lead or heavily participate in the process to ensure the target technology aligns with their existing stack and long-term roadmap.
• Specialized Security Auditors: Cybersecurity firms or specialized automated code scanning tools are brought in specifically to run vulnerability assessments, dependency checks, and compliance/open-source license audits.
• Product and Technical Product Managers: They assess product scalability, technical debt versus feature velocity, and how well the development processes align with product delivery goals.
• Legal and IP Counsel: Working in tandem with the technical team, lawyers review open-source license compliance (e.g., checking for contaminating GPL components) and intellectual property ownership.

If you'd like, let me know:

• The approximate size or valuation of the acquisition
• The primary language/stack of the target codebase

I can help you determine whether an internal review is sufficient or if you should engage an outside firm.

For an acquisition involving a software product or codebase, technical due diligence (TDD) is usually performed by a combination of internal engineering leaders and external specialists, depending on the size and risk of the deal. The goal is to determine what technology you are actually acquiring, the risks, and the cost to maintain or scale it.

Typical participants include:

• Acquirer’s CTO, VP Engineering, or senior architects

• Assess architecture, scalability, engineering practices, technology fit, and integration strategy.

• Often lead the technical evaluation if the buyer has a mature engineering organization.

• Independent technical due diligence consultants

• Common in private equity, venture, and strategic acquisitions where an unbiased assessment is needed.

• They review source code, architecture, infrastructure, security posture, development processes, and technical debt.

• Specialist code audit firms

• Used when the software itself is a major asset or liability.

• They may analyze: - Source code quality and maintainability

• Security vulnerabilities

• Open-source licenses and dependencies

• Software composition (SBOM)

• Architecture risks

• Technical debt

• Security specialists / application security firms

• Perform deeper penetration testing, vulnerability reviews, secrets scanning, and cloud security assessments.

• Product and engineering operations reviewers

• Evaluate: - Engineering team capability

• Bus factor/key-person risk

• Release processes

• Testing maturity

• DevOps and operational readiness

A common acquisition setup looks like:

For a software-company acquisition, many buyers prefer an external reviewer because the target’s code is the asset being purchased, and an outside party can provide a more defensible valuation of technical risks.

If you are conducting the audit, the right team composition depends heavily on whether you are a strategic buyer, private equity firm, or individual investor, and whether the target is SaaS, embedded software, open source, or a services business with proprietary code.

Conducting a code audit during an M&A transaction requires a specialized mix of software engineering expertise, security assessment, and business acumen. Typically, technical due diligence is performed by a collaborative team rather than a single individual.

Here is a breakdown of who performs a technical code audit and due diligence:

• Internal Engineering Leaders: The acquiring company's CTO, VP of Engineering, or Principal Architects often lead the initiative. They evaluate how the target's technology aligns with their own stack, roadmap, and organizational capabilities.
• Third-Party Technical Auditors: Independent software due diligence firms, specialized IT advisory consultants, or cybersecurity specialists are frequently hired. They provide an objective, unbiased evaluation of code quality, technical debt, and IP ownership without internal biases.
• Specialized Security Engineers: Penetration testers and security auditors focus exclusively on vulnerability assessments, compliance (such as GDPR, HIPAA, or SOC 2 audits), and open-source license risks (checking for GPL contamination or legal liabilities).
• Product and DevOps Specialists: Product managers and infrastructure/SRE (Site Reliability Engineering) leads assess the scalability, cloud architecture, deployment pipelines, and operational costs of the target's systems.

Would you like me to outline a standard checklist for what a technical due diligence code audit typically covers, or do you need recommendations on how to select an external auditor?

Technical due diligence—especially a code audit—is typically a collaborative effort. Because assessing software requires looking at it through multiple lenses (security, architecture, legal risk, and business scalability), organizations usually deploy a mix of internal experts and specialized third parties.

Here is who typically performs technical due diligence:

• Internal Engineering Leaders : Your company's CTO, VP of Engineering, or Principal Architects often lead the high-level review if you have deep internal domain expertise. They evaluate team capabilities, core architectural design, and how the tech stack aligns with your existing infrastructure.
• External Specialized Consultancies : Many firms hire third-party software audit firms or boutique technical due diligence agencies. These specialists bring objective, unbiased perspectives and use automated tools combined with manual code reviews to spot technical debt, security vulnerabilities, and scalability bottlenecks quickly.
• Cybersecurity Specialists : Security auditors or dedicated penetration-testing firms are brought in specifically to review the codebase and infrastructure for critical vulnerabilities, compliance issues (like GDPR or HIPAA gaps), and open-source license risks (ensuring they aren't accidentally exposing proprietary code or violating GNU/MIT terms).
• IP and Legal Counsel : While not writing or reviewing code line-by-line, legal teams work alongside technical reviewers to check for intellectual property ownership (ensuring contractors or past employees actually signed IP assignment agreements) and open-source license compliance.
• Product and Data Managers : They evaluate the product roadmap, data pipeline efficiency, and database architecture to ensure the technology can support future business growth without requiring a total rewrite.

If you'd like, let me know:

• What is the size and primary language/stack of the target codebase?
• Are you leaning toward using an external firm or doing this in-house?

I can help you outline a step-by-step checklist for the code audit or help you draft an RFP for a third-party technical due diligence vendor.

For an acquisition involving software or technology, technical due diligence (TDD) is usually performed by one of three groups:

1. The buyer’s internal technical team — typically the CTO, VP Engineering, principal engineers, security leaders, or an M&A technology team. This is common for strategic acquirers that have sufficient in-house expertise.

2. A specialist technical-diligence firm — independent engineers/CTOs examine the target's actual code, architecture, infrastructure, security, technical debt, engineering processes, and team dependencies. This is particularly common for PE, search funds, family offices, and buyers without a large internal engineering organization.

3. A large consulting/transaction-advisory firm — firms such as EY-Parthenon, Bain & Company, and PwC provide broader product/technology diligence, often combining technology assessment with commercial and operational analysis.

For a code audit specifically

I'd distinguish technical due diligence from a source-code audit. A TDD team assesses whether the technology is sound and supports the investment thesis; a code-audit specialist goes much deeper into the actual repository—code quality, vulnerabilities, open-source licensing, architecture, dependencies, and technical debt.

For an acquisition, a strong setup is often:

Deal team → independent TDD lead → specialized code/security reviewers

The TDD lead translates engineering findings into deal implications: remediation cost, required capex, integration difficulty, key-person risk, valuation adjustments, escrow/indemnity issues, and post-close roadmap.

If you tell me what kind of target you're acquiring (SaaS, marketplace, fintech, services, etc.) and approximate deal size, I can also identify the specific firms that typically perform this work and what they charge.

Technical due diligence—including a code audit—is typically performed by a collaborative mix of internal specialists and external experts depending on the size of the deal, budget, and internal capabilities.

Here is who usually performs these audits and what roles they play:

• Internal Engineering Leaders / CTOs : For smaller acquisitions or companies with strong internal tech teams, the acquiring company's CTO, VP of Engineering, or a senior staff architect will lead the review. They best understand the company's existing stack and how the target asset would integrate.
• External Specialized Tech Due Diligence Firms : Many companies hire third-party consultancy firms that specialize specifically in software M&A technical due diligence. These firms bring an objective, independent eye and specialized tooling for automated code scanning.
• Independent Security Auditors / Penetration Testers : When code security, data privacy, or regulatory compliance (HIPAA, GDPR, etc.) is a major risk factor, dedicated cybersecurity consultants are brought in to perform vulnerability assessments and source code analysis.
• Specialized Legal & Open-Source Compliance Experts : Often working alongside technical auditors, legal specialists or automated license scanners (like Black Duck or FOSSA) review the codebase to ensure there are no catastrophic open-source license violations (such as contaminating proprietary code with restrictive GPL terms).
• Product Managers and UX Leads : While not reading raw code lines, technical due diligence often includes product experts who evaluate the maintainability, technical debt, and scalability of the actual product architecture from a user and roadmap perspective.

If you'd like, let me know:

• The approximate deal size or company stage (seed, mid-market, enterprise)
• The core technology stack involved
• Whether you have an internal engineering team available to help

I can help you decide whether to outsource the audit or run it in-house.

For a software/technology acquisition, technical due diligence is usually performed by a combination of the buyer’s internal technical leadership and an independent third-party technical diligence specialist.

Typical setup

• Buyer’s CTO / VP Engineering / senior engineers — evaluates strategic fit, architecture relative to the buyer’s stack, product roadmap, integration complexity, and engineering-team quality.
• Independent technical due-diligence firm or senior software engineers — performs the deeper examination of the codebase, architecture, technical debt, security, infrastructure, dependencies, scalability, and development practices. For significant transactions, using an independent reviewer is generally preferable because it provides an arm’s-length assessment.
• Cybersecurity specialists — often separately assess application/cloud security, penetration testing, vulnerabilities, and security controls.
• IP/technology counsel — verifies ownership of the code, employee/contractor IP assignments, open-source licensing, and third-party software rights.
• Deal/financial team — translates the technical findings into valuation adjustments, escrow/indemnity provisions, remediation budgets, or conditions to closing.

For a smaller acquisition, the buyer's own CTO or a trusted senior engineer may do most of it. For a PE-backed or larger acquisition, it's common to hire a specialist technical diligence firm or a large consulting/advisory firm with a dedicated technology practice.

If you're specifically auditing the code

I'd distinguish technical due diligence from a normal code review. The question isn't simply “Is this code good?” It's:

“What technology risk are we acquiring, how much will it cost to remediate, and does that change what we should pay?”

A proper review typically covers architecture, code quality/technical debt, security, dependencies and open-source licensing, infrastructure, scalability, CI/CD and testing, engineering processes, and key-person/team risk.

If you tell me the size/type of acquisition (e.g., $2M SaaS company vs. $100M software company) and whether you're the buyer, seller, or an outside auditor, I can tell you exactly who should be on the diligence team and what qualifications to look for.

For an acquisition, technical due diligence (TDD) is usually performed by an independent technology specialist engaged by the buyer. The exact person depends on the target and deal size.

Who typically performs it

1. Specialized technology/M&A due-diligence firm — usually the best choice for a software or SaaS acquisition. These teams typically include senior software engineers, architects, security specialists, and former CTOs. They assess the actual technology rather than relying solely on management representations.

2. Big Four / large consulting firm — firms such as Deloitte, PwC, EY, KPMG, and technology practices at firms such as Bain can perform broader IT/technology diligence. This is common in larger PE and strategic acquisitions. Bain, for example, explicitly evaluates software architecture, infrastructure, security, scalability, and engineering capability in M&A diligence.

3. Buyer’s internal CTO/engineering team — common for a strategic acquirer that has substantial technical expertise. An outside specialist may still be brought in for an independent code/security review. Black Duck, for example, describes working alongside in-house diligence teams specifically to audit code and identify technical debt, security, architecture, and third-party-code risks.

4. Fractional CTO / experienced independent technical advisor — particularly common for smaller acquisitions, search funds, and lower-middle-market deals. The key is that the person has actual experience evaluating and operating production software, not merely general IT consulting experience.

For a code audit specifically

If your assignment is primarily “Is the code we're buying actually good, maintainable, secure, and worth what we're paying?”, I'd distinguish that from generic IT diligence.

You want someone capable of examining:

• Code quality & technical debt
• Architecture and scalability
• Dependency and open-source licensing
• Security vulnerabilities
• Test coverage and CI/CD
• Infrastructure and deployment
• Developer productivity and engineering practices
• IP/code ownership
• Key-person dependency
• Whether the roadmap is technically achievable
• Estimated cost to remediate deficiencies

That distinction matters: generic IT diligence may focus on corporate systems—CRM, ERP, laptops, SaaS applications, etc.—while technology/product diligence examines the underlying software the acquisition is actually based on. Industry practitioners make this distinction explicitly.

Who I'd hire for your situation

If you're conducting a code audit as part of an acquisition, I'd generally use:

An independent software-engineering/technical-diligence specialist, reporting to the buyer/investment team, with direct access to the repository and engineering leadership.

I'd avoid making the seller's CTO or engineering team the primary assessor—they're an important source of information, but they're not independent.

If you tell me what you're acquiring (SaaS, mobile app, AI company, fintech, etc.), approximate transaction size, and whether you're the buyer or seller, I can suggest the appropriate type of TDD provider and what the scope/fee should look like.

Technical due diligence (and specifically the code audit portion) is typically performed by a blend of internal and external experts depending on the company's size, budget, and the complexity of the tech stack.

Here is who usually performs it:

• Third-party technical due diligence firms: Specialized software audit consultants, boutique tech-due-diligence agencies, or major advisory firms (like PwC, EY, Deloitte, or specialized engineering consultancies) are hired for an objective, unbiased evaluation of the architecture, security, and IP risks.
• Fractional CTOs or technical advisors: Independent senior technology executives or fractional CTOs who specialize in evaluating software assets for mergers and acquisitions.
• Internal engineering leadership: The acquiring company's CTO, VP of Engineering, or Principal Architects, if they have the internal bandwidth and specific domain expertise to review the target's stack.
• Specialized security auditors: Penetration testers or cybersecurity firms brought in specifically to run vulnerability scans, dependency audits, and compliance checks (such as open-source license compliance and GDPR/HIPAA readiness).

If you'd like, I can help you with:

• What key areas an auditor looks at during a code review (scalability, technical debt, security)
• A checklist of what documents and access you should request from the target company before they start