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Venture Capital Due Diligence

This definitive guide by Justin Camp is the manual for 'Forensic Investigation' of startups. It moves beyond the pitch deck to the gritty reality of 'Data Room' hygiene. Key focuses include: 'Legal DD' (ensuring IP assignments are clean), 'Financial DD' (verifying revenue recognition policies), and 'Reference Checks' (the back-channel calls investors make to your former bosses). It emphasizes that bad diligence kills more deals than bad products, often due to discoverable lies or omitted cap table complications.

Why is relevant?

The deal isn't closed until the wire hits the bank. This archive is a survival guide for the 60-90 days between the Term Sheet and the Closing. It helps founders pre-emptively scrub their corporate record, organizing contracts and IP disclosures to ensure the diligence process is a smooth validation rather than a painful autopsy.
Venture Capital Due Diligence, investment firm website screenshot
Author
Justin J. Camp
Publication date
February 21st, 2002
Difficulty
Basic
Keywords
  • Due diligence checklist
  • startup legal audit
  • financial verification
  • intellectual property assignment
  • cap table hygiene
  • reference checks
  • data room preparation
  • investor scrutiny
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