Introduction

Financial due diligence is where investors verify everything you have said in your deck and model.
It reveals whether your business is stable, defensible, and ready for capital.

Founders often fear due diligence because they lack documentation or structure.
Investors do not expect perfection, they expect readiness.

A prepared founder signals maturity,
An unprepared founder signals operational risk.

This checklist covers exactly what you need before entering due diligence.

1. Corporate and Legal Documents

Investors expect clean, accessible documentation.

This includes:

• Registration records

• Cap table

• Shareholder agreements

• ESOP documentation

• Board minutes

If legal documentation is messy, investors see governance risk.

2. Financial Records

Due diligence requires:

• Accurate bookkeeping

• Bank statements

• Tax filings

• P and L, balance sheet, cash flow

• Revenue and expense breakdowns

Clarity here is a strong trust signal.

3. Customer and Revenue Data

Investors examine:

• Customer lists

• Contracts or invoices

• Renewal data

• Churn patterns

• Cohort behavior

If revenue claims cannot be traced, confidence collapses.

4. Operational Metrics

You need structured documentation on:

• CAC

• LTV

• Conversion rate data

• Marketing channel performance

• Sales pipeline details

Metrics that are inconsistent with your model become risk indicators.

5. HR and Team Structure

Investors validate:

• Key employee contracts

• Compensation

• Hiring plans

• Founder vesting

Weak team documentation signals instability.

Final Message

Due diligence is not a hurdle, it is a credibility moment.
Prepared founders raise faster and smoother because they show operational strength and governance discipline.