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Leading Due Diligence - Session 2 - Resources & Tools


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Catherine Chiu and Steven Lamont discuss how to lead due diligence for Angel investments, in this section 2/4 focusing on tools and resources.

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Leading Due Diligence - Session 2 - Resources & Tools

  1. 1. The Art and Science of Leading Due Diligence Catherine Chiu and Steve Lamont Keiretsu Forum Northern California
  2. 2. Second of a Four-Part Series <ul><li>1. Due Diligence Process </li></ul><ul><li>2. Resources and Tools </li></ul><ul><li>3. Effective DD Leadership </li></ul><ul><li>4. Dealing with Challenges </li></ul>
  3. 3. The Handbook & Resources <ul><li>Best Practices from Experienced DD Leaders </li></ul><ul><li>Checklists and Reference Guides </li></ul><ul><li>Adoption by Other Chapters – in Process </li></ul><ul><li>Team Still in Place: On-Going Reviews & Revisions </li></ul><ul><li>Bootcamps: Great Background and Prep </li></ul>
  4. 4. Key Sections of DD Handbook Section Contents Main <ul><li>Due diligence checklist by Stage </li></ul><ul><li>Activities and deliverables </li></ul><ul><li>Roles </li></ul>Appendix A <ul><li>Company overview documentation </li></ul>Appendix B <ul><li>Document binder checklist </li></ul>Appendix C <ul><li>Industry-specific questions for software, hardware, life-sciences, telecom & real estate </li></ul>Appendix D <ul><li>Site visit guidelines </li></ul>Appendix E <ul><li>Reference check questions </li></ul>Appendix F <ul><li>Final report outline </li></ul>Appendix G <ul><li>Google Groups settings and guidelines </li></ul>Appendix H <ul><li>Keiretsu Forum due diligence values </li></ul>Appendix I <ul><li>Standard disclaimer to add to documents </li></ul>Appendix J <ul><li>Common deal terms, definitions, and illustrative text </li></ul>Appendix K <ul><li>Valuation methodologies – an imperfect world for angels </li></ul>
  5. 5. K-4 DD Code of Ethics <ul><li>Open Process </li></ul><ul><li>Due Care with Public Forum </li></ul><ul><li>Respectful but Thorough Assessment </li></ul><ul><li>Contrarian Views with Due Process </li></ul><ul><li>Full Disclosure of Relationships </li></ul><ul><li>Contributing Members of the Team </li></ul><ul><li>Sufficient Opportunities for Review & Rebuttal </li></ul><ul><li>Respectful of Entrepreneur's Time and Cash </li></ul>
  6. 6. The Tools – No Panacea <ul><li>Gold Sheet = Your Primary “Audience” </li></ul><ul><li>Google Groups (Bay Area) </li></ul><ul><ul><li>Tool for broadcast emails to interest group, status posting, load files, request feedback </li></ul></ul><ul><ul><li>Limited for discussion threads or document collaboration </li></ul></ul><ul><li>Investor’s DD Posting Site: </li></ul><ul><ul><li>Usually they choose and manage </li></ul></ul><ul><ul><li>Can be OneHub, Google Groups, PBWorks, … </li></ul></ul><ul><li>Audio Conference Calls (or In-Person Meetings) </li></ul><ul><ul><li>Frequency important </li></ul></ul><ul><ul><li>Check free conference call services </li></ul></ul><ul><li>Web Meetings </li></ul><ul><ul><li>Low participation; least common denominator </li></ul></ul><ul><ul><li>Go-to-meeting, Webex, MS Live, etc. </li></ul></ul>