Diligence
Operational Due Diligence (ODD)
The workstream that evaluates a GP's non-investment operations: valuations, controls, service providers, technology, cyber, BCP, and key-person risk.
ODD failures are over-represented in fund blow-ups. A great investment team with weak operations is a higher-risk commitment than a B+ team with institutional infrastructure.
Leading practice is an annual or biennial on-site, written ODD report with explicit ratings, and named follow-ups with deadlines.