Funding & Investment

Due Diligence

The investigation and analysis process investors conduct before making an investment.

Full Definition

Due diligence is the comprehensive investigation and analysis that investors conduct before making an investment decision. It typically includes reviewing financials, legal documents, customer contracts, technology, team backgrounds, and market analysis. The process can take 2-8 weeks and helps investors verify claims, identify risks, and determine appropriate valuation.

Examples

  • 1VCs typically conduct 4-6 weeks of due diligence before Series A
  • 2Due diligence often includes customer reference calls and technical review