Quality of earnings has two front doors, and the deals between one and seventy-five million dollars get to use neither.
Through the first door are the national and Big-Four firms. Real rigor, real credibility, a fee that often starts around seventy-five thousand dollars, and a timeline measured in months. Through the second door are the bargain shops: frequently a web form and a templated report, sometimes a team you never meet in a time zone you cannot call during your workday. Cheap, fast, and thin in exactly the spots where deals go wrong.
If you are buying a real business in the lower middle market, neither door was built for you.
Why the big firms price you out
It is not greed. It is the model. A Big-Four QofE runs on leveraged hours: a partner's name on the cover, a manager's review, and a stack of associates doing the work by hand underneath. That pyramid is expensive to operate, so the fee has to be large enough to wheel it out of the garage. Below a certain deal size they do not bother, or they bother and the invoice makes a good deal hurt.
Why the cheap shops cost you more
The discount providers solve for price by quietly solving for depth. They sample. They template. They skip the management conversation where the real adjustments surface. You save twenty thousand dollars, and you learn after close that the largest customer was the owner's brother-in-law. You did not, technically, get a bargain.
The middle was stuck. Then the math moved.
For years, the only way to get serious depth was to pay for serious hours. AI broke that link. When software reads one hundred percent of the ledger and every dollar through the bank, the depth no longer depends on how many associates you can afford to put on the file.
The expensive part of diligence was never the thinking. It was the volume.
Hand the volume to a machine and the thinking gets cheaper to deliver, not thinner. That single shift is what finally makes institutional depth affordable for a five-million-dollar deal.
Where the space goes from here
The firms that adopt this will serve the middle market at a price it can actually carry. The firms that do not will spend the next few years explaining why their hours are a feature. Watch which firms describe AI as a risk to be managed rather than a tool to be used. It is usually the firms whose business model is the thing actually at risk.
That gap, real depth made available to the lower middle market, is the entire reason Greenwood exists.