Audit Liquidity Assumptions Constraints and Dependencies
Systematically catalog all internal and external dependencies influencing liquidity, such as venture revenue benchmarks, buyer interest, and board approvals. Highlight key assumptions regarding company valuation multiples, market liquidity conditions, and secondary share discount rates.
Auditing assumptions and constraints uncovers hidden operational, legal, and financial deal-breakers before formal liquidity execution begins. It protects the venture's core capital structure by highlighting where external investor consent or operational milestones are non-negotiable prerequisites.
Produce a detailed risk and dependency log explicitly citing legal covenants, valuation assumptions, tax regulations, and necessary third-party consents. Every dependency must be assigned a risk severity score and a validated mitigation plan.
Five questions an expert would ask when reviewing your output
Use these to challenge assumptions, pressure-test your logic, and check the quality of this action's output in the context of the parent task and wider venture development.
- 1
What evidence proves your assumption that secondary buyers will accept less than a 25% discount on founder ordinary shares?
- 2
How did you stress-test the dependency on target revenue growth if market demand contracts next quarter?
- 3
Which board members or lead investors hold explicit veto power over this liquidity strategy, and what is their known stance?
- 4
Why do you assume current macroeconomic conditions will support secondary equity buyouts within your target timeframe?
- 5
How does your dependency on key-person insurance or legal restructuring affect the timing of this liquidity event?