How is due diligence conducted?
Members conduct due diligence themselves on a voluntary basis. A lead diligence coordinator is generally chosen, an agreed-upon diligence checklist is utilized (which is never less thorough than the minimum guidelines set by the Angel Capital Association), groupware and collaborative tools are utilized wherever possible to enhance efficiency for members and entrepreneurs, and diligence reports are shared openly within the PRC group (and with syndication partners from other groups, where appropriate). Diligence reports are not shared outside of the group or with the entrepreneur.
One of the great strengths of angel investing is the opportunity to share knowledge and experience during due diligence. Usually, after a company presents, Network members interested in investing in the company will meet and develop a plan for due diligence. Taking into account members’ background and expertise, the group assigns due diligence tasks to members. When the due diligence is complete, all contributing members report on their findings. The group then decides whether, as individuals, they wish to invest. If you would like more information on being an investor with CBBI Center Clients click here.
