Methodology
Evidence → materiality → investment implication → action.
Novarra’s method starts with the decision the investor or management team needs to make, then defines the evidence required and the limits of what that evidence can establish.
Seven-step method
A decision-led review, not a generic checklist.
The exact workstreams vary by engagement, but the evidence discipline remains consistent.
01
Frame the decision
Start with the investment, portfolio or operating decision—not a generic checklist.
Evidence: Investment thesis, transaction context, management priorities, decision timeline and known concerns.
02
Define the evidence perimeter
Agree what information is required, what is unavailable and what can be tested directly.
Evidence: Architecture, product, security, AI/data, delivery, people, vendors, financial assumptions and relevant documentation.
03
Examine and test
Review available evidence and challenge assumptions with management and technical leaders.
Evidence: Documents, systems, repositories where permitted, demonstrations, interviews, metrics and third-party evidence.
04
Separate fact from inference
Make clear which conclusions are directly evidenced, source-reported, analytically inferred or unresolved.
Evidence: Claim classification, confidence level, evidence gap and validation status.
05
Assess materiality
Focus on the issues that can change risk, value, timing, capex, execution or exit readiness.
Evidence: Severity, likelihood, dependency, business impact and remediation complexity.
06
Translate to investment implications
Connect technical observations to the decisions investors and management actually need to make.
Evidence: Conditions, priorities, cost/effort ranges where supportable, 100-day actions and board escalation.
07
Deliver with boundaries
State what the work establishes, what remains uncertain and who retains decision authority.
Evidence: Executive summary, detailed findings, red flags, roadmap, assumptions, exclusions and limitations.
Evidence classification
Separate what is known from what is inferred.
A material finding should not become stronger in the report than the evidence that supports it.
Verified fact
Supported directly by primary evidence or multiple strong corroborating sources within the engagement scope.
Source-reported claim
Reported by management or another identified source but not independently established as fact.
Analytical inference
A conclusion drawn from the available evidence, with assumptions and confidence made explicit.
Unresolved / requires confirmation
Potentially material, but the available evidence is insufficient to conclude either way.
Materiality
Focus effort where the investment can actually change.
Not every technical weakness is an investment issue. Materiality is judged by its connection to the thesis, execution, risk and transaction context.
- Investment thesis
- Revenue or growth dependency
- Operating cost and cost-to-scale
- Capex / remediation requirement
- Cyber, privacy and resilience risk
- AI opportunity or disruption exposure
- Leadership and key-person dependency
- Transaction timing and conditions
- Exit readiness and buyer confidence
Reporting principle
Material issues should explain the evidence reviewed, business consequence, investment implication, confidence, recommended action and remaining uncertainty.
Where the evidence does not support precise cost, timing or valuation impact, the report should say so rather than create false precision.
Illustrative transaction cadence
A focused diligence can move quickly without collapsing evidence quality.
The timing below is illustrative for a compact transaction review and changes with scope, access, company complexity and management availability.
Day 0
Scope and decision framing
Confirm the decision, access, materiality threshold, workstreams, stakeholders and reporting route.
Days 1–3
Evidence intake
Review the data room and available technical evidence; identify gaps and management questions.
Days 3–7
Deep review and management challenge
Test the most material architecture, product, security, AI/data, vendor, people and delivery assumptions.
Days 7–9
Synthesis
Translate findings into red flags, investment implications, remediation priorities and unresolved items.
Days 9–10
Decision read-out
Deliver the executive view, answer decision-maker questions and hand material items into post-close priorities.
Decision authority
The method improves evidence and judgment; it does not replace the decision maker.
Investors, boards and management remain responsible for investment decisions, legal advice, implementation and acceptance of residual risk.