Use Case

Technical Due Diligence for
Mergers & Acquisitions

Financial due diligence reveals balance sheet health. Technical due diligence reveals whether the engineering team can actually maintain and extend the software you're acquiring.

The Hidden Risk in Every Software Acquisition

Traditional code audits examine architecture and technical debt. But they miss the human factor: What happens if key engineers leave after the deal closes?

ContributorIQ answers the questions that determine post-merger success:

  • Which engineers hold critical, irreplaceable knowledge?
  • What percentage of the codebase has only one person who understands it?
  • Are key contributors showing signs of disengagement before you even sign the LOI?
  • How resilient is the engineering organization to normal turnover?

What Private Equity and VC Firms Learn from ContributorIQ

Bus Factor Analysis

The bus factor measures how many engineers would need to leave before a project stalls. ContributorIQ calculates this using Degree of Authorship (DOA) analysis, a research-backed methodology that goes beyond simple commit counts.

A bus factor of 1 on a critical repository means a single departure could halt development. We've seen acquisitions where 60% of repositories had a bus factor of 1. That's not a software company. That's a collection of single points of failure.

Contributor Lifecycle Classification

Not all contributors are equally engaged. ContributorIQ classifies each engineer into lifecycle stages:

  • Peak: Actively and consistently contributing
  • Ramping Up: New to the codebase, still building context
  • Winding Down: Activity declining, often a precursor to departure
  • Dormant: No recent contributions but still technically on the team
  • Departed: Gone for over a year

When your acquisition target has three "Peak" contributors and two of them are "Winding Down," you have a retention problem that needs to be priced into the deal.

Organization Health Score

The Organization Health Score (0-100) rolls up bus factor, knowledge concentration, and contributor activity into a single metric. Use it to:

  • Compare engineering health across multiple acquisition targets
  • Establish baseline metrics for post-merger monitoring
  • Identify which repositories need immediate attention after close

Orphaned File Detection

Orphaned files have no active contributor with meaningful ownership. They're the code that nobody on the current team truly understands. In M&A, orphaned files represent maintenance risk: bugs will take longer to fix, and changes may introduce unexpected regressions.

How It Works

1

Install the GitHub App

On the target organization (requires their cooperation during diligence)

2

Run an Audit

Across all repositories in minutes

3

Review the Risk Dashboard

Showing bus factor, health scores, and lifecycle distributions

4

Generate PDF Reports

Suitable for investment committee presentations

Case Study: Identifying Hidden Concentration Risk

A mid-market PE firm was evaluating a $40M acquisition of a B2B SaaS company. Financial due diligence showed healthy ARR growth and reasonable churn.

ContributorIQ revealed a different story:

  • The core billing system had a bus factor of 1
  • That single contributor was classified as "Winding Down"
  • 34% of files across all repositories were orphaned
  • Organization Health Score: 28/100 (Critical)

The firm renegotiated terms to include an earnout tied to key employee retention and a lower upfront purchase price reflecting the integration risk.

For Investment Professionals

ContributorIQ is built for non-technical stakeholders. You don't need to understand code to understand:

  • • A bus factor of 1 is dangerous
  • • "Winding Down" contributors may leave post-close
  • • A Health Score of 28 is worse than 72

Our PDF reports are designed for investment committee presentations, with executive summaries that translate technical metrics into business risk language.

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