Deals Don't Die on Cyber IssuesThey Die on Surprises
60% of M&A transactions involve material cyber risk that traditional due diligence misses. The average cost of a data breach in 2024: $4.88 million. Post-close cyber litigation has increased 300% since 2020.
Traditional IT due diligence checks if systems work. We check if they're liabilities.
No commitment. Just a conversation about your transaction timeline and cyber risk exposure.
Three Pillars of Cyber Due Diligence
Our assessment methodology covers the critical vectors where cyber risk hides in M&A transactions.
Device Security Assessment
Complete device hygiene evaluation across all endpoints. We assess patch compliance, EDR coverage, and asset inventory to verify devices are clean, current, and free of persistent threats.
- Hardware and software asset inventory
- OS and application patch levels
- EDR deployment status
- Known vulnerability mapping
- Malware and persistent threat scanning
Question we answer: Are the computers and devices protected?
Infrastructure Security Review
Deep network assessment including firewall configurations, segmentation, VPN integrity, and intrusion detection. We verify the network is properly hardened against threats.
- Firewall rule audit and permissions
- Network segmentation validation
- VPN and remote access security
- IDS coverage assessment
- Wireless network security
Question we answer: Is the network secure and properly configured?
Digital Identity Verification
Complete domain health check including email authentication (SPF/DKIM/DMARC), certificate validation, and dark web exposure monitoring. We confirm digital identity integrity.
- Email authentication protocols
- SSL/TLS certificate health
- Domain reputation and blacklist status
- Dark web credential exposure
- Public-facing asset exposure
Question we answer: Is the digital identity clean and not compromised?
Not All Cyber Assessments Are Due Diligence
Traditional security audits are built for IT departments. We're built for deal teams.
| Dimension | Standard Security Audit | M&A Cyber Due Diligence |
|---|---|---|
| Timeline | 4-8 weeks | Efficient standard delivery |
| Audience | IT/Security teams | Deal teams, boards, counsel |
| Output | CVE scores, technical findings | Financial exposure quantification |
| Language | Technical severity | Materiality, liability, deal impact |
| Context | Generic security posture | Transaction-specific risk |
| Deliverable | Technical report | Board-ready briefing + documentation |
| Outcome | Remediation list | Negotiating leverage + deal protection |
The Stakes Are Higher Than You Think
Regulators now scrutinize whether acquirers performed adequate cyber due diligence.
Average cost of a data breach in 2024
Source: IBM Cost of a Data Breach Report
of M&A transactions involve material cyber risk missed by traditional due diligence
Purchase price adjustments due to cyber findings (percentage of deal value)
Increase in post-close cyber litigation (2020-2024)
Regulatory context you need to know:
Built for the Deal Team
Not the IT Department. Every stakeholder in the transaction has unique needs. We address them all.
Protect Portfolio Investments
You've modeled the financials. Validated the market. Confirmed the management team. But 60% of M&A deals involve material cyber risk that traditional due diligence misses. A single undetected breach can trigger purchase price adjustments of 15-40% and impact your fund performance.
Key Benefits
- Risk-adjusted purchase price
- Portfolio-level cyber posture benchmarking
- LP due diligence expectations met
- Deal timeline compatibility
Outcome: Protect your investment thesis with defensible cyber intelligence.
Disclosure-Grade Findings. Defensible Opinions.
Your client is relying on you to surface material risks before signing. Cyber exposure is now a standard materiality category. We deliver attorney-ready work product that holds up in negotiations and protects all parties post-close.
Key Benefits
- Disclosure schedule support
- Materiality threshold alignment
- Indemnification escrow sizing
- Expert witness credibility
Outcome: Add cyber defensibility to your process with professional-grade findings that hold up under scrutiny.
Deal Velocity Preservation
You've worked months to get both sides to the table. A last-minute cyber surprise can derail everything. We help you surface cyber issues early, provide buyers with professional-grade findings that build trust, and keep your timeline intact with our streamlined assessment process.
Key Benefits
- Deal velocity preservation
- Pre-listing cyber readiness
- Buyer due diligence preparation
- Transaction timeline compatibility
Outcome: Deal velocity preservation. No last-minute surprises.
You're Not Just Buying Assets
The target company's financials look solid. But what's buried in their IT infrastructure? Undisclosed data breaches, regulatory non-compliance, ransomware vulnerabilities. Traditional IT due diligence checks if systems work. We check if they're liabilities.
Key Benefits
- Fiduciary duty documentation
- Board reporting readiness
- Director and officer liability exposure
- Purchase price adjustment leverage
Outcome: Fiduciary duty documentation. Board reporting readiness. Personal liability assessment for directors and officers.
What You Receive
Complete documentation package designed for deal teams, not IT departments.
Executive Summary Report
Non-technical, board-ready overview of findings, risk exposure, and recommended actions
Technical Findings Report
Detailed analysis with severity ratings, financial exposure quantification, and evidence documentation
Risk Register
Prioritized remediation guidance with cost estimates and timeline recommendations
Certificate of Cyber Health
Formal attestation issued when target meets acceptable security threshold (deal-ready documentation)
Deal Timeline Compatibility
Standard engagements delivered with efficiency that respects deal momentum. Rush assessments available when time is critical.
Attorney-Ready Documentation
Findings formatted for disclosure schedules, representations and warranties, and indemnification language
Post-Close Integration Intelligence
Remediation roadmap for the first 90 days post-acquisition
Why Trust 3rd Stone Networks
Born from Experience
Our team has defended mission-critical systems from NASA to Linux kernel contributions. We've seen what breaks, what holds, and what matters.
This isn't a startup racing to exit. It's a mission to solve real problems that keep real people vulnerable.
NIST CSF Aligned
Our assessment methodology aligns with the NIST Cybersecurity Framework, the gold standard recognized by regulators, insurers, and boards.
- Attack surface mapping
- Regulatory exposure analysis
- Third-party independent findings
Transparency First
We'll tell you what we can't assess as clearly as what we can. If we don't find material risk, you'll know it's because we looked thoroughly.
Our reports are designed to be understood by general counsel, referenced in SPA negotiation, and defensible in post-close disputes.