Retirement Services Due Diligence: Testing the Cross-sell Thesis

Sparsh took on this workstream within a broader commercial due diligence at McKinsey, where a private equity client was evaluating a retirement services company.

He was given full ownership of the workstream. His first move was to build a structured set of scenarios around the cross-sell opportunity, drawing on McKinsey's internal knowledge base and secondary research to generate six to seven distinct hypotheses about how the target could expand into adjacent services.

To test those scenarios, Sparsh conducted a series of expert and stakeholder interviews, including legal experts with ten to twenty years of experience litigating in this space, and former employees of competitor firms. The interviews were designed to probe each scenario directly, not to confirm the original thesis.

What the Evidence Showed

Across multiple conversations, a consistent pattern emerged: the fiduciary regulations in question had been stalled since around 2016, caught in political and legal back-and-forth, and could not be reliably counted on as a business lever. The legal experts were unambiguous that the market remained in a gray area.

Of the six scenarios Sparsh had built, two were clearly feasible and already being executed by leading players. Two were neutral, still in pilot phases with limited evidence. Two did not hold up under scrutiny.

Communicating the Finding

Sparsh structured the client communication using a top-down pyramid approach: leading with the conclusion that the fiduciary tailwind was not a reliable growth lever, then supporting it with expert testimony, trusted industry sources, and a clear confidence assessment. When the client pushed back, citing competitor moves and their own prior conviction, he held the position. He also built an Excel-based market sizing model to give the client an estimated scale of the opportunity, while being explicit that it was an estimation with stated assumptions, not data-backed actuals.