Preparing your startup for due diligence

published on Compliance Management, Contract Management, Entity Management, IP Management, Reporting
Preparing for due diligence can be an all-consuming task for a startup. A potential investor or buyer might demand a long list of legal documents: board meeting minutes, articles of incorporation, the top 50 customer vendor agreements, the historical ownership structure of the company, and more. It’s up to your team to pull everything together in a timely manner to ensure the deal is a success. Getting your head around the requirements in the form of a Due Diligence checklist can be a good place to start.

For many startups, the desire to keep margins thin means that you often have few resources to commit to retrieving documents, summarizing information and printing out reports. If the preparation of due diligence falls on the CEO, CFO or sole Legal Counsel, it’s vital that you leverage tools to overcome the challenges that are native to startups: lack of structure and resources. After all, you don’t want any surprises in the evaluation to derail the investment.

So, how can you prepare your startup for eventual due diligence?  

Managing documents in a consistent way

The first – and arguably most important – way to get in front of the challenges of preparing for due diligence is to have a smart document management system in place. Why? Because document retrieval and manually generating reports can be a major drain on your resources.

Compiling documents for due diligence can be an all-consuming task: pulling together documents that are scattered across hard drives or hidden in emails, checking accuracy with colleagues and manually plugging data into a spreadsheet to help you present all the information in a cohesive way.

Instead, with a consistent document management system, you can trust that the information at hand is complete and accurate. Meta data like contract values, business registration, addresses, dates of acquisition, expiration dates and more are tracked and can easily be found without having to comb through documents. And, when all your data is cross-referenced your team can compile, present and share the information your potential investor needs quickly and securely, making your company more attractive.

By taking proactive measures to ensure your information is well organized in a smart system, you can focus your team on the strategic work of due diligence rather than the paperwork.  

Preparing for due diligence with Legisway

With Legisway Essentials, you have a single tool to manage and report on all your entities, contracts, compliance, claims and corporate housekeeping.

Here are a few ways you can transform all this information into reports you may need a due diligence process:
  • Create ownership structures easily. If you need to show the current ownership structure across multiple entities, Legisway Essentials can generate an org chart for you at the touch of a button.
  • Create historical ownership structures. Ownership structures can change over time, and your investor may want to see this. With Legisway Essentials you can generate historical org chart too.
  • Create custom reports on contracts. Do you need to evidence customer and supplier contracts? With Legisway Essentials, you can quickly compile reports according to contract value, length, department, expiry date and much more.
  • Keep track of company director appointments. Provide a record of company director appointments in a matter of seconds.
  • Plus, with Legisway Essentials you can share documents securely. If you need to share all the information securely with your investors or their legal teams, Legisway Essentials can become a simple data room.


To help you prepare for due diligence, download our Beginner’s Guide to Due Diligence. It’s free and includes a helpful checklist to rate your current readiness and identify where you need to improve your company’s legal data governance.

Due diligence checklist