Due Diligence Case


None of the businesses even the future-oriented and properly organised could not exist without sponsorship. The source of financing is a key point of becoming startup successful. So,the first thing you have to think before starting a new business is the ways and opportunities to attract new investments.

As a rule, it is required to go through some stages to obtain new investments. At first hand seeking for investors in order to investigate all terms such as on what terms they are ready to invest, ways of support (money,expert evaluation, acquaintanceship and so on and so forth). After making a choice is a preparatory stage in order to make a deal (to sign Term Sheet, to check for Due Diligence).

It was for the service of Due Diligence that the client who wanted to become a startup investor appealed to us. Due Diligence or briefly — DD is a procedure for drawing up an objective opinion on the object of investment. The procedure includes a preliminary analysis, audit of financial and economic activity of a startup or company, documentation and internal processes, conditions of work in the market and the specifics of the company’s marketing (product uniqueness). Special emphasis in DD is given to risk assessment in all activities of the enterprise. This is a comprehensive study, the results of which are provided to the customer in the form of a report. This information will help to a potential investor to make an objective image of an investment object and to make a decision on whether to make a deal or not.

We conducted DD that included:

  • Reviewing and evaluating the statutory documents of a start-up company( structure and management strategy)
  • Verification of transactions with affiliates
  • Evaluation of non-current assets (ownership, security deposit, estate property of a company)
  • Assessment of company resources, vendor relationship
  • Verification of confidentiality

A detailed report was compiled, on the basis of which the investor decided to invest $ 500,000 in the company. The deal has been completed successfully.

A defining feature of this transaction is that all its participants are the residents of the Republic of Belarus.

Actually, it was the first venture deal with direct investments of the venture fund in the capital of the Belarusian start-up. It was done under English law in accordance with the HTP Decree 2.0 (as decree number 12 is called).

In addition to providing financial due diligence services, our company has concluded an agreement with the company on further cooperation, and today we are startup auditors.