

Getting Funded, Step 4: Due Diligence - mooreds
https://medium.com/getting-funded/getting-funded-step-4-due-diligence-3d2ab36fa187

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dkyc
Just the technical bullet points: _" block diagram of the product’s
components, inputs/outputs to processes in the diagram, internal and external
interfaces to the product, languages, frameworks, libraries used,
extensibility, portability, openness, standards compliance, scalability,
development infrastructure, IDE, Version control, Build tools, Defect tracking
systems, Development methodology"_

Is this really a normal amount of information investors request from
companies? What's the point of knowing all of this? Asking it implies that #1
the company has all this data in place, otherwise it's wasting time getting it
together, #2 the investors know better than the founders about architecture,
technology and toolsets and #3 a significant amount of times a term sheet is
revoked because of trouble with build tools, standard compliance or a
"development methodology". I'm feeling the author just listed everything he
could think of rather than everything that actually matters.

~~~
teachingaway
The quantity of diligence is usually proportional to the size of the deal.

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tptacek
Be careful of DD done prior to a term sheet, as it allows the VCs to retain
optionality on your company in a way that is pretty cheap for them and very
expensive for you. Arranged calls with bizdev and customer prospects from a
VC's rolodex looks like progress but doesn't necessarily mean anything.

I'd love to know how people who are good at this qualify VC prospects and
decide what kinds of up-front due diligence to acquiesce to.

