DiligenceSquared leverages AI and voice agents to lower the cost of M&A research

A standard merger-and-acquisition process is often both slow and costly, even for the biggest and best-resourced private equity firms. Alongside spending significant time meeting with senior executives at potential acquisition targets and building financial models, these firms also spend millions of dollars on outside advisers, including accountants, lawyers, and management consultants.

Because fees paid to external advisers are not reimbursed if a transaction collapses, private equity firms usually delay bringing in expensive specialists — such as consultants from McKinsey, BCG, or Bain — until they are confident they want to pursue a deal. Those advisers are typically hired to carry out detailed commercial research on both the target company and the broader market.

DiligenceSquared, a startup that was part of Y Combinator’s Fall 2025 batch, says it can use AI to deliver commercial research at the quality of top consulting firms while charging only a small fraction of the usual cost.

The startup’s co-founders, Frederik Hansen and Søren Biltoft, bring significant experience in private equity diligence. Hansen previously worked as a principal at Blackstone, where he commissioned these types of reports for several multibillion-dollar buyouts. Biltoft, meanwhile, spent seven years in BCG’s private equity practice, where he led similar diligence efforts.

Since launching in October, Hansen and Biltoft have used their industry background to help DiligenceSquared complete several projects for some of the world’s largest private equity firms and mid-market funds, Hansen said.

That early momentum helped persuade Damir Becirovic, a former partner at Index Ventures, to lead DiligenceSquared’s $5 million seed round through his new venture capital firm, Relentless.

Rather than relying on costly management consultants, the startup uses AI voice agents to interview customers of the companies that private equity firms are considering buying.

DiligenceSquared is using an AI interview model similar to that used by consumer research startups such as Keplar, Outset, and Listen Labs, which raised $69 million in January at a $500 million valuation. But Hansen and Biltoft say their diligence process and final deliverables are fundamentally different from the consumer research products those startups provide.

According to Hansen, private equity firms can pay between $500,000 and $1 million for firms like McKinsey, Bain, or BCG to interview dozens of corporate customers, including C-suite executives, and produce 200-page reports that combine those findings with proprietary market data. To maintain the quality of the output, DiligenceSquared continues to include senior human consultants who review the final work for accuracy and commercial insight.

Because AI is handling much of the foundational work, the startup says it can provide the same type of analysis for around $50,000.

“We are taking these great insights that were previously reserved for the very big decisions, and now we make them more accessible,” Hansen said. With the lower cost, private equity firms are now much more open to using DiligenceSquared earlier in the process, long before they have a strong conviction about a deal.

DiligenceSquared is not the only company trying to reshape the diligence market. One of its main rivals, Bridgetown Research, raised $19 million in Series A funding, co-led by Accel and Lightspeed,d in February 2026.

In addition to Hansen and Biltoft, DiligenceSquared was also co-founded by Harshil Rastogi, a former Google engineer.