Validate Human Capital Health Data | M&A Due Diligence

The HCHS is a proprietary, data-driven metric that quantifies the operational and behavioral vitality of a target organization. Unlike traditional HR audits that focus solely on compliance and cost, the HCHS aggregates over 47 metrics across 22 critical areas—including Change Resistance, Adaptability, and Alignment—to provide a "Green-to-Red" heat map of the company’s actual workforce strength.

Traditional firms perform Lagging Indicator Audits: they look at past payroll, benefit liabilities, and historical turnover. FQ3C™ performs Leading Indicator Validation: we track real-time behavioral data through our proprietary goal-tracking platform. We don't just tell you how many people left last year; we tell you who has "checked out" today and what the "flight risk" looks like for the next six months.

No. This is a core advantage of the FQ3C™ model. Standard due diligence often relies on intrusive "Employee Engagement Surveys" that act as a "flare," signaling an impending sale and triggering anxiety. Our data is gathered through a functional performance platform where users track their own goals. Because the data is extracted from natural behaviors rather than "deal-specific" surveys, we maintain the "stealth" required during sensitive pre-close windows.

Privacy and data integrity are built into our trade secret formulas.

• The Buyer View: Receives a "Heat Map" of departments and anonymized Employee IDs. They see the health of the asset without seeing PII (Personally Identifiable Information).
• The Seller View: Receives granular insights to address specific leadership gaps before the sale. This "Double-Blind" approach ensures that the buyer can make an informed financial decision without violating labor privacy standards or GDPR/CCPA regulations.

In our model, "Absence of Data is a Data Point." If a founder or leadership team fails to submit required data or engage with the validation process, the HCHS can drop to zero. This provides a critical "Red Flag" for buyers regarding the seller's transparency, motivation, and the potential for "hidden rot" within the organizational governance.

Yes. In modern M&A, "Human Capital" is often the largest intangible asset on the balance sheet.

• Validation: If we validate a high Adaptability and Alignment score, it justifies a higher multiple.
• Risk: If our "Heat Map" identifies high Change Resistance in a core engineering department, it provides the buyer with the data needed to negotiate a "retained equity" structure or a purchase price adjustment to offset the integration risk.

There is no minimum. Because we track engagement vs. non-engagement, even a total lack of interaction from a department is a valuable insight. A department that refuses to track goals or engage with the platform is a primary indicator of "Quiet Quitting" or leadership failure—information that is vital to a buyer’s ROI projection.