How We Solved It
With an informal due-diligence period of only three days, it was a challenge to collect as much insight as possible as quickly as possible. Therefore, Sphere provided accelerated M& A Due Diligence services focused on the following:
References — in a seed round, the development team is the only true investable asset. Therefore, references from previous employers were used to understand career longevity, stability, responsibility, and to uncover potential red-flags.
Financial — in a seed stage round, books unencumbered by personal account intermingling allow investors to make a judgment on financial discipline.
Customer calls — to understand the value of the product, it was important to speak with multiple beta users. When only positive references are received, we sought references from other customers.
Code review — the software architecture was scrutinized and a sample of code was examined. The processes employed by the developers were also documented.
With this information collected, a fast report detailing findings and concerns was then delivered to the investor.