Impressing potential investors in initial meetings is only the first step toward establishing a lasting partnership. Due diligence can be the perfect opportunity to present your startup as prepared, capable and professional, but not always. When partnerships between startups and potential investors fall apart during due diligence, the fracture can typically be traced back to one or more of these four red flags. Kyle Krahl, MBA, ASA Manager + Forensic, Valuation and Litigation at Anders detailed missteps that could derail a partnership with a venture capital firm or angel investor for St. Louis Inno.
He writes in the article, “Trust is irreplaceable for any partnership to work, including a financial one. As such, breaking that trust between the potential investor and the founder, even in a minor way, will eliminate the possibility of an investment.” Kyle explains what steps a startup can take to ensure the best possible route to success during due diligence and what proactive steps to take to make a positive impact.
Trust is irreplaceable for any partnership to work, including a financial one. As such, breaking that trust between the potential investor and the founder, even in a minor way, will eliminate the possibility of an investment. – Kyle Krahl
Learn more about which red flags investors look out for and what actions a startup can take to excel during due diligence by reading the full article: 4 red flags startups might encounter during investor due diligence that could sink a partnership.
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