Fundraising
Due Diligence
The investigative process a VC conducts before investing — reviewing financials, references, technology, legal documents, and market assumptions.
Due diligence (DD) is the structured investigation a VC firm conducts after initial interest but before finalizing an investment. The scope varies by stage: seed-stage DD might take 1-2 weeks and focus on founder references and market validation; Series B+ DD can take 4-8 weeks and involve audited financials, legal review, customer interviews, and technical assessments. Common DD components: founder background checks, customer calls, employee references, product review, financial model review, cap table review, legal document review, competitive analysis. A data room — a shared folder of key company documents — facilitates the process. Founders should be proactively transparent during DD; inconsistencies or surprises destroy trust and can kill deals.