Quality of Earnings for Private Equity & Deal Teams
Published February 2026
The bottleneck isn't finding deals — it's analyzing them fast enough to act.
2–4 hours
Per target screening
$30K–$100K
External QoE cost avoided at screening stage
Parallel
Analyze multiple targets simultaneously
Private equity firms evaluate dozens — sometimes hundreds — of deals per year. Each one requires financial diligence. The bottleneck isn't finding deals; it's analyzing them fast enough to act. AI-assisted QoE gives deal teams the speed and consistency to screen more deals without adding headcount.
The PE Challenge
Lower-middle-market and middle-market PE firms face a diligence capacity problem. External QoE engagements cost $30K–$100K each and take 4+ weeks. You can't commission a full QoE on every deal you're considering — but you also can't afford to miss red flags because you skipped financial analysis on a promising target.
Speed Across Deal Volume
Shepi enables a two-stage diligence approach: rapid internal screening with Shepi, followed by formal external QoE on deals that pass initial analysis.
Pre-LOI screening
2–4 hours per target vs. weeks of waiting for external QoE
Parallel processing
Analyze multiple targets simultaneously
Data-driven decisions
Make kill decisions based on actual financial analysis, not just CIM metrics
Consistency & Standardization
One of PE's persistent challenges is ensuring consistent analysis quality across deal team members.
Structured workflow
Every analysis follows the same process — no missed steps
Standard taxonomy
Consistent categorization across all deals
AI-assisted review
Flags potential adjustments and red flags that less experienced analysts might miss
Portfolio comparability
Standardized output format makes it easy to compare targets
Portfolio Screening
For platform companies making add-on acquisitions, speed is everything. The portfolio company's management team often does the initial financial review. Shepi gives them a structured framework without requiring deep M&A experience.
Deal Team Workflow
Associate uploads financials
Trial balance, income statement, balance sheet
Shepi structures the data
Auto-mapped accounts, multi-period analysis, preliminary findings
Associate reviews and refines
Validates adjustments, adds context, documents rationale
VP/Partner reviews output
Clean, consistent format for quick review and decision
Go/no-go decision
Based on normalized EBITDA, red flags, and working capital analysis
Complementing External QoE Providers
Shepi doesn't replace your relationship with CPA firms — it makes those engagements more efficient. When you commission external QoE, you can share Shepi's preliminary analysis as a starting point, reducing the CPA firm's ramp-up time and your costs.