Due diligence is an inevitable fact of life for growth-oriented startups. Whether your startup is pursuing an investment round, government grant, or M&A opportunity, there will come a time when you need to open up your company files for outside scrutiny.
Use the following checklist to build a file organization structure and be disciplined about saving your files to stay prepared for due diligence.
Company
- Information Articles of incorporation
- By-laws
- Minutes, board resolutions, board decks
Securities Issuance
- Legal docs for all issuances
- Cap table
- Options, warrants
Contracts
- Customer
- Vendor
- Employment
- Licenses and insurance
Indebtedness
- List of all banks and non-bank lenders
- List of any liens or outstanding borrowing
Marketing
- List of competitors
- Marketing brochures
- Sales commission structure
- Marketing studies
Property
- List of any real property owned or leased by company
Employees/Contractors
- List of name, title, and compensation
- Details on employee benefit plans
Licenses and Permits
- Copies of permits/licenses
- Certificates from all states where company operates
Litigation and Claims
- Description of past, current, and threatened claims, lawsuits, disputes, proceedings, etc.
Financial Information
- Financial statements since formation
- Budgets and projections
Taxes
- Federal, state and local tax returns
- Correspondence with any taxing authority
Intellectual Property
- Registrations for patents, trademarks, copyrights, and service marks
- Copies of any NDAs and Development Agreements
| Also see Burkland’s “Surviving Due Diligence” series: |
I hope this due diligence checklist and the related articles help you prepare for a successful funding round. Burkland’s team has provided due diligence support for hundreds of venture-backed startups. Contact us to request more information about how we can help your company.