The Due Diligence Hierarchy of Pain

View from Seed

When a founder is raising money, he/she should expect that any serious investor will conduct some level of due diligence before getting to yes. I find that most investors I like to work with are pretty mindful of the cost associated with each step of their due diligence.

How Smart Startups Survive Investor Due Diligence

Startup Professionals Musings

This is the mysterious and dreaded due diligence process, which can kill the whole deal. Some entrepreneurs do very little to prepare for due diligence, assuming all the talking has already been done, and the business plan and results to-date tell the right story.

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Doing Due Diligence on Potential Investors

View from Seed

One of the often neglected parts of fundraising is the process of doing due diligence on potential investors. Partnering with an investor and/or board member is very long term commitment, and I’m always surprised by how little diligence founders do prior to signing up for what could be a 10+ year collaboration. When you do your VC diligence, here are some of the things to consider focusing on. I’d recommend focusing your diligence on these issues.

5 Steps To Reduce Due Diligence Investment Failures

Startup Professionals Musings

In my activities as an angel investor, and my work with new ventures seeking investment, I find the “due diligence” stage to be fraught with the most risk. Since due diligence will include one or more visits from investors, everyone needs to be on the same page, with no surprises.

7 Due Diligence Steps Will Validate Any New Venture

Startup Professionals Musings

Some analysis and due diligence along the following lines should be performed on every idea, as a reality check, before committing your efforts and other people’s money to building a business: Look for places where competitors are few. due diligence idea check new venture reality chec

Startup Due Diligence Success Requires Advance Work

Startup Professionals Musings

If your startup is great enough to get a term sheet from angel investors or a venture capitalist, the next step for the investor is to complete the dreaded due diligence process. entrepreneur startup investor due diligence business

Proper Due Diligence: The “Other” List

YoungUpstarts

The task of vetting a business prior to a potential purchase is referred to as due diligence. Most speculators will find the due diligence process to be tedious at best. The mere mention of the phrase “due diligence” likely intimidates some, but it shouldn’t.

Entrepreneurs Due Diligence on Investors Is Smart

Startup Professionals Musings

Due diligence should always be a two-way street. A while back, I published an article on “ Startup Due Diligence Is Not a Mysterious Black Art ,” describing what investors do to validate your startup before they invest.

Sell Your Business Fast With These 6 Due Diligence Tips

YFS Magazine

Selling your business is very often a complex process, so here are 6 due diligence tips to keep in mind. Grow Operations business brokers due diligence selling a business

8 Key Questions To Expect In Investor Due Diligence

Startup Professionals Musings

In the parlance of an investor, asking these questions and getting answers is the heart of that mysterious “due diligence” process. If you are a potential employee, you need to do the same due diligence before you sign on.

Startup Investors: Due Diligence Goes Both Ways

VC Cafe

Ciaran O’leary of Earlybird, a VC fund in Berlin, gives founders a checklist for running due diligence on their potential investors. 101 Due Diligence Earlybird due diligence VC 101

Startup Due Diligence Is Not a Mysterious Black Art

Startup Professionals Musings

This is the dreaded “due diligence” process. In my view, understanding due diligence can only improve information flow, and leads to a better long-term partnership with your investor. Secondly, conduct your own due diligence of the investor.

Understanding the Dreaded Investor Due Diligence

Startup Professionals Musings

This is the dreaded “due diligence” process. In my view, understanding due diligence can only improve information flow, and leads to a better long-term partnership with your investor. Secondly, conduct your own due diligence of the investor.

Prepare Your Startup Team for Investor Due Diligence

Startup Professionals Musings

If your startup is great enough to get a term sheet from angel investors or a venture capitalist, the next step for the investor is to complete the dreaded due diligence process. Some startups do nothing to prepare for the due diligence process, assuming the people and business plan documents will speak for themselves. Depending on the availability of staff and needed information, the due diligence process generally takes 2–6 weeks to perform.

How to Survive the Dreaded Due Diligence Process

Startup Professionals Musings

If your startup is great enough to get a term sheet from angel investors or a venture capitalist, the next step for the investor is to complete the dreaded due diligence process. entrepreneur startup investor due diligence business

Five Easy Steps to Investor Reverse Due Diligence

Startup Professionals Musings

Due diligence should always be a two-way street. A while back, I published an article on “ Understanding the Dreaded Investor Due Diligence ,” describing what investors do to validate your startup before they invest.

How Much Information Should you Give VCs for Due Diligence?

Both Sides of the Table

There is no reason to part with your cap table or legal docs until you’re convinced that they’re actually committed to doing work with you in due diligence. ” Heading into a Term Sheet – Final Due Diligence.

Premature Extensive Due Diligence

The Startup Lawyer

Occasionally, angel investors will send extensive due diligence requests to a startup way too early. By way too early, I mean an angel investor sends your startup an 8+ page due diligence request — without having made any sort of “commitment” to invest. This is problematic for a number of reasons. First, this could be […]. Startup Issues

8 Key Questions To Expect In Investor Due Diligence

Gust

In the parlance of an investor, asking these questions and getting answers is the heart of that mysterious “due diligence” process. If you are a potential employee, you need to do the same due diligence before you sign on. Image via LeadChangeGroup.com.

Due Diligence Explained with Guidance!

ithacaVC

Due diligence never has a good connotation. Due diligence is critical to help VCs derisk our investments a bit. I recently read a fabulous (now that is a word you never associate with due diligence!) Lisa’s post includes a slide deck that explains her vision of due diligence as a 12 step program; this is clearly relevant as due diligence will drive anyone to the bottle! I hope this helps you survive due diligence!

Limited Partner Due Diligence on Venture Capital and Private Equity Funds

David Teten

As a VC, I have a standard due diligence list for companies I’m reviewing. Similarly, our limited partner investors have their own due diligence standards, and we manage HOF Capital to keep in line with their standards and expectations.

Limited Partner Due Diligence on Venture Capital and Private Equity Funds

David Teten

As a VC, I have a standard due diligence list for companies I’m reviewing. Similarly, our limited partner investors have their own due diligence standards, and we manage HOF Capital to keep in line with their standards and expectations.

Entrepreneurs: Due Diligence on Investors is Smart

Gust

Due diligence should always be a two-way street. A while back, I published an article on “ Startup Due Diligence Is Not a Mysterious Black Art ,” describing what investors do to validate your startup before they invest. Here is the inverse, sometimes called reverse due diligence, describing what you should do to validate your investor before signing up for an equity partnership.

5 Keys To Vetting Investors Before You Accept Funding

Startup Professionals Musings

Struggling entrepreneurs are often so happy to get a funding offer that they neglect the recommended reverse due diligence on the investors. funding investor reverse due diligenceEven though the color of their money is always green, all startup investors are not the same.

8 Questions You Should Ask Before You Join A Startup

Startup Professionals Musings

These questions are the key ones in every due diligence effort, always done by accredited investors, but almost never done by key employees and new partners. due diligence questions startup

Giving Due Diligence Calls Their Due

Genuine VC

All of that being said, it surprises me how infrequently startups, and especially startup founders, make diligence calls to pressure-test their decisions. The old adage that it’s only necessary to expend 20% of the effort to benefit from 80% of the results is absolutely true with diligence calls. At the end of the day, diligence calls come in two varieties: either check-the-box affirmative of what you already know, or tougher ones which come down to interpretation.

Doing your due diligence before you begin: What are the top 7 challenges restaurant owners face?

Our Own Start-up

Restaurant owners face a lot of competition and need to get expert advice before going into business.

Startup Due Diligence Is Not a Mysterious Black Art

Gust

This is the dreaded “due diligence” process. In my view, understanding due diligence can only improve information flow, and leads to a better long-term partnership with your investor. Secondly, conduct your own due diligence of the investor.

The Importance of Due Diligence in M&A Transactions

Scott Edward Walker

I’ve been handling a number of M&A transactions over the past few months from the buy-side, and one mistake I’m repeatedly seeing is the failure of the acquirer to perform an adequate due-diligence investigation of the target. As I discuss in this video from a few years back (starting at the 0:24 mark), I first learned of the importance of due diligence as a young lawyer at a major law firm in New York City. INTRODUCTION.

Who, Why, When: 15 Minute Due Diligence for the Modern Investor

Growthink Blog

It is upon these “ Due Diligence ” matters where the real - as opposed to the theoretical - money on early stage deals is made. Now, due diligence - as it is done by serious, professional investors - is an enormous undertaking. I call them the “Who, Why, and When” 15 minute Modern Due Diligence Checklist. Over the last two weeks we have discussed the motivations of private equity investors , and then characteristics of companies with breakout potential.

Q & A: How Do I Evaluate This Business? Real-World Due Diligence

Up and Running

BTW, a vocabulary note: in entrepreneurship we refer to “ due diligence ” as the process of checking out a proposal for flaws, the equivalent of kicking tires, making sure what’s said is actually true. And due diligence applies generally to all business situations involving a buyer and seller of a business or a portion of a business. So a lot of my answer here applies generally to the process of due diligence.

Reblog – “Taking Control: Due Diligence on Your Terms”

ithacaVC

Just read a great post by Brad Svrluga (High Peaks Venture Partners) on how to best prepare in advance for the typically painful process of VC due diligence. Hey, Happy Thanksgiving! Thorough analysis that takes some of the mystery out of the process. Enjoy it here. Enjoy your holiday. Dealing with VCs Startup Life

Due diligence: An Entrepreneur's Perspective - Startups and angels.

Tim Keane

Due diligence: An Entrepreneurs Perspective. Due diligence by an investor, seen from the entrepreneurs point of view, is all good. Listed below are links to weblogs that reference Due diligence: An Entrepreneurs Perspective : Comments. Due diligence: An Entrepreneurs Perspective. Due diligence by an investor, seen from the entrepreneurs point of view, is all good. Startups and angels: Along the way to success.

5 Ways To Check Your Investor Intent Before Signing

Startup Professionals Musings

Struggling entrepreneurs are often so happy to get a funding offer that they neglect the recommended reverse due diligence on the investors. angel entrepreneur funding investor reverse due diligence

8 Questions Before You Join Or Invest In A Startup

Startup Professionals Musings

These questions are the key ones in every due diligence effort, always done by accredited investors, but almost never done by key employees and new partners. due diligence employees investors startup

Size Up Your Investors Before Accepting Their Money

Startup Professionals Musings

Struggling entrepreneurs are often so happy to get a funding offer that they neglect the recommended reverse due diligence on the investors. business entrepreneur investor reverse due diligence startup

Why Entrepreneurs Must Learn to Love Paperwork  

The Startup Magazine

Be able to prove due diligence whenever you can. This extends to your respect for diligent record keeping as well; if you establish keeping clear and updated written records as a core part of the business then others will follow suit.

[Interview] Brian Connell-Tombs, Founder Of CT Compliance Consulting

YoungUpstarts

Connell-Tombs stresses that any concern that intends to provide services to clients, directly or as a supplier to financial institutions, must be aware of due diligence questions and related activities.

Due Diligence Reveals All - To The VC

Seeing Both Sides

Some readers have pointed out to me that I left out a very key element of the due diligence process: what the process itself reveals about the nature of the entrepreneur to the VC. Many entrepreneurs I know underestimate the importance of their small and large actions during due diligence and the signals their behavior send to the VCs. VCs don’t typically enter a true due diligence process until after the 2nd or 3rd meeting.

Recruitment: Top mistakes made by hiring managers

The Startup Magazine

You don’t perform due diligence. Staffing Startups benefits Candidate careers due diligence employee hiring Interview London networking pension perks Recruitment Team building UK UniversityAs we all know, recruitment is a hugely expensive game.

Hiring 138

Creating a successful business

The Startup Magazine

Do due diligence. Once you have done your due diligence, offer your product or service and see if it’s well-received amongst potential customers.

Top Startup Winner: Balodana

The Startup Magazine

Anticipating the challenges of due diligence helped me to crystallize our tech development strategy and the sales strategy, and guided our financial planning. The Startup Magazine recently featured two of the FUND Conference Top 3 Exhibitor winners, Happenstance , and Digs.

How Start Your Own T-Shirt Printing Business

The Startup Magazine

Remember to perform your due diligence to ensure you aren’t using any trademarked or copyrighted material on your t-shirts. Dreaming of being an entrepreneur and have your sights set on helping others express themselves through their clothing?