Due Diligence (DD)
The investigation an investor performs to verify a startup’s claims before investing.
Due diligence covers financial, legal, commercial and technical checks — confirming the cap table, contracts, IP ownership, financials, metrics and team. A well-prepared data room speeds this up and builds trust. Surprises during DD are a common deal-killer, so founders should keep records clean from day one.
Examples
An investor reviews customer contracts and IP assignments during DD before closing. — A deal stalls when DD reveals unassigned founder IP.
How it relates to The Startup Foundry
The Foundry’s Deal Room helps you organise everything investors will want to see, so you sail through due diligence with the co-funding partners you’re introduced to.