[mostlystatic]

I wondered about that when reading the Money Stuff article about it a while ago. What should they actually have done differently?

One of the issues was that "she could not share her customer list due to privacy concerns". So maybe JPM could have pushed back against that more?

"""Javice also cited privacy concerns in sharing Frank’s customer data directly with JPMC. After numerous internal conversations, and in order to allay Javice’s concerns, JPMC agreed to use a third-party data management vendor, Acxiom, to validate Frank’s customer information rather than providing the personal identifying information directly to JPMC."""

[cldellow]

I was involved in some diligence when a prior company was considering an acquisition. The numbers they claimed vs the numbers we could trust from their various SaaSes were pretty fishy. It was a small deal - more like $1M. We didn't pursue them, they don't exist any longer.

The gap here was _huge_. If I was the JPM diligence team, I might have asked them for read-only access to their product analytics. They claimed something like 10K FAFSA applications/day. This should show up nicely in their analytics tools. Yes, they could fake these visits--but it would be much harder to fake that you're getting 10K visits from appropriate regions, at appropriate times of day, with appropriate dwell times, with appropriate distribution of completion rates.

[nradov]

In most jurisdictions it would generally be possible for the seller to hire outside counsel to validate customer metrics claims under attorney-client privilege without violating consumer privacy laws or customer agreements. The outside attorney could then provide a letter to the buyer attesting to what they found without revealing any specifics about individuals. Of course that would delay the deal, and the buyer here seems to have been irrationally eager to close the acquisition.

[landemva]

> What should they actually have done differently?

Credit card processor revenue reports over prior months may have shown startingly small revenue. Match that with bank statements.