Anyone who has watched a show like Shark Tank or Dragon’s Den will be familiar with concept of due diligence. Investors will study a business financials, legal documents and other important individuals and suppliers, as well as customers to make a decision about investing. They will also do due diligence on the business’s strategy, market position and growth projections.
When it concerns fundraising due diligence is a vital method that is intended to verify the information provided by a potential donor. It usually involves rigorous reviews and assessments that are conducted by a prospect-development department or a specialized team. The scope of your inquiry may be broad, therefore it’s crucial to establish which criteria are most important for your business.
The most frequently asked inquiries are:
Financial Details – An in-depth review of the background of the potential donor including their financial history. This will typically include the last ten years including all liabilities, assets and earnings data.
Technical Information – Investors will want to know the technology you are using and how it will grow in the near future. They’ll also want be aware of your client base and any contract information that may be relevant.
Other areas of inquiry include: