Before investing in any early stage company, it is crucial investors conduct adequate due diligence to ensure an informed decision can be made on the opportunity and transaction. The level of due diligence that should be completed will differ from investor-to-investor and transaction-to-transaction, and may be influenced by the involvement of other parties and the due diligence they subsequently complete.
Include in this post:
- an individual investor due diligence checklist, incorporating five key areas including questions that we believe every venture capital investor should be asking or understand of an early stage company prior to investing.
- a sample of GCV’s own extensive due diligence documentation that our investment team uses to assess the current position and potential performance of a portfolio company prior to an investment transaction.
Whilst these are key areas we have outlined to be influential in determining the growth potential of an early stage company, fulfilling all of this criteria does not guarantee that a startup investment will be successful. Subsequently, investors should always be aware of the full range of risks associated with early stage venture capital prior to investing.