Startup Funding Espresso – The Basic Due Diligence Process

The Basic Due Diligence Process Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. Investors funding a startup must first complete the due diligence process. The objective is to understand all the particulars about the company and the team. Here is the list of the basic due diligence process: The investment. This includes the term sheet, other investors in the round, and dilution impact. Financials. This includes the income statement and balance sheet. If they have revenue, then how much is recognized and when? Do they have debt on the books? What do the financial projections look like for the coming 3 to 5 years? Tax returns if there are any. Team. Who is on the team, and what does their CV look like? Background checks should be run on the key personnel. Contracts. What contracts have been signed for generating revenue? Employee contracts and IP assignments are in this category. Corporate What legal entity is the business filed under? C-Corp, LLC, other? Intellectual property What patents were filed and when? Sales and Marketing What are the current sales channels, revenue, and marketing programs? What are the main products the company sells? Consider this basic list of due diligence for your next investment. Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding. Let's go startup something today. _________________________________________________________ For more episodes from Investor Connect, please visit the site at: http://investorconnect.org Check out our other podcasts here: https://investorconnect.org/ For Investors check out: https://tencapital.group/investor-landing/ For Startups check out: https://tencapital.group/company-landing/ For eGuides check out: https://tencapital.group/education/ For upcoming Events, check out https://tencapital.group/events/ For Feedback please contact [email protected] Please follow, share, and leave a review. Music courtesy of Bensound.