How to Speed Up Fundraising Due Diligence

As the founder of a startup seeking financing, it is crucial to be prepared to provide investors with equity funding like venture capital firms or angel funding the information required for fundraising due diligence. This is the time when interested parties research a business to confirm important details and metrics, meet the criteria for investment, and research potential risks before making an investment decision.

In the process of due diligence, VCs may ask for documents regarding your business, such as taxes, legals, financials and compliance. Due diligence will be accelerated and delays reduced if these documents are readily available. A VDR can allow you to store and access these documents quickly while also managing permissions to ensure that only those who are required access to them are allowed to access them.

You can speed up due diligence by using other tools that complement the VDR. These include setting up an automated system for uploading important files into an organized folder. This will help you reduce your workload as you will no longer have to manually www.eurodataroom.com/the-flexibility-that-will-be-functional-with-a-virtual-data-room/ collect and upload documents. It is beneficial to establish a schedule of when each document will be required so that the VC will know when you are ready to upload them.

Another way to prepare for the due diligence process is to instruct your gift managers in fundraising due diligence. This includes gift acceptance policies. This can involve creating the list of triggers that, if they are met will require a thorough risk rubric. Examples include international potential as well as scandals or crimes known to the public, and solicitations exceeding a certain dollar amount, like the naming of donations.