We conduct due diligence on acquisition and investment targets. We review the business - its dynamics and processes as well as the numbers, because the risks inherent in acquisitions rarely appear in the numbers. We create value by giving opinions and practical advice, not simply confirming what you already know.
Before investing in a company, a venture capital firm goes through a stringent review process to ensure that there are no skeletons in the corporate’s closet and that the perceived business opportunities are in fact real.
The due diligence process generally focuses on two aspects: business diligence and legal diligence.
Business Due Diligence
The business due diligence process accomplishes several objectives. First of all, it is important for the venture capital firm to independently confirm the assertions about a company's product or service and the market itself. Thorough competitive and financial analyses will help to gauge the risks the investors will be assuming and the potential return on their investment. If the business plan hinges on technology, the venture firm will also need to assess the technology to make sure that there are no flaws in or infringements on patents, for instance.
If you are seeking later-stage funding, the venture firm will also contact key customers and suppliers to do reference checks. Industry experts may also be called on to discuss your company's potential.
In addition, because the success of your company hinges on a strong management team, it is important for investors to gain a complete sense of the company and the key players. Background checks are not unusual and your culture, management approach, and decision-making and problem-solving skills will be judged.
The checklist of requested documents will typically include the following:
Under the feasibility we consider the following steps:
# - Key contracts
# - Employment agreements
# - Minutes and consents of the board of directors and shareholders
# -Confidentiality and invention assignment agreements with employees
# - Corporate charter and bylaws
# - Litigation-related documents
# - Patents, copyrights, and other intellectual property-related documents
# - Past financing agreements and shareholder agreements
Aakkam has experienced corporate finance, industry and tax experts, as well as lawyers and accountants, who are all directed at creating value by focusing on those areas where you will see immediate benefit. We focus on reducing and managing both inherent business risk and transaction risk to increase the likelihood of acquisition success. Our approach is not merely to identify potential problems and risk areas but to provide solutions as to how they can be overcome.