duediligence

Front-line Tips on Due Diligence for Entrepreneurs

by

September 6, 2012

What to disclose – and when to disclose it – during the due diligence process was the topic of two lengthy detailed PE blog posts this week, one by Edward Zimmerman, a lawyer and angel investor, and one by Mark Suster, a tech entrepreneur that now works with GRP Partners.

 

Suster says it is important to disclose the following: major lawsuits, founder friction and early resignations, people in the company who were convicted of felonies, as well as major firings from previous companies (which would mean that reference phone call may not go well).

 

Zimmerman added some thoughts on when to disclose, as well as a few other ideas on what to disclose, including medical conditions, such as previous heart attacks, family pressures due to illnesses, employee or founders’ criminal records, bankruptcy, and resume inaccuracies.

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