{"id":1109,"date":"2026-04-14T12:31:44","date_gmt":"2026-04-14T15:31:44","guid":{"rendered":"https:\/\/montreal.ventures\/?post_type=glospa-glossary&#038;p=1109"},"modified":"2026-04-14T12:31:44","modified_gmt":"2026-04-14T15:31:44","slug":"due-diligence","status":"publish","type":"glospa-glossary","link":"https:\/\/montreal.ventures\/en\/glossary\/due-diligence\/","title":{"rendered":"Due Diligence"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Due diligence is the process of in-depth auditing and investigation carried out by investors before they formalize the signing of an investment agreement. The objective is to validate all information presented by the startup during the pitch and initial negotiations, aiming to mitigate risks. The process covers four main areas: <\/span><b>Legal<\/b><span style=\"font-weight: 400;\"> (client contracts, corporate compliance, trademarks and patents); <\/span><b>Financial<\/b><span style=\"font-weight: 400;\"> (bank statements, debts, cash flow, and tax obligations); <\/span><b>Technological<\/b><span style=\"font-weight: 400;\"> (intellectual property of the code, data security, and infrastructure scalability); and <\/span><b>Operational<\/b><span style=\"font-weight: 400;\"> (analysis of the team and internal processes). Due Diligence can last from a few weeks to months and is the final step before the capital transfer.<\/span><\/p>\n<p><b>Practical Example:<\/b><span style=\"font-weight: 400;\"> A Venture Capital fund sent a Term Sheet to a HealthTech startup. Before transferring the money, the fund hires lawyers and accountants to verify if the startup has the necessary health licenses to operate, if the software truly belongs to the company, and if there are no hidden labor lawsuits. If any serious irregularity is found, the investor may withdraw from the deal or renegotiate the valuation.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"> Read the book <\/span><i><span style=\"font-weight: 400;\">Bad Blood<\/span><\/i><span style=\"font-weight: 400;\">, by John Carreyrou.<\/span><\/p>","protected":false},"excerpt":{"rendered":"<p>Due Diligence \u00e9 o processo de auditoria e investiga\u00e7\u00e3o profunda realizado por investidores antes de formalizarem a assinatura de um contrato de [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":1110,"template":"","glospa-glossary-category":[],"class_list":["post-1109","glospa-glossary","type-glospa-glossary","status-publish","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/glospa-glossary\/1109","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/glospa-glossary"}],"about":[{"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/types\/glospa-glossary"}],"author":[{"embeddable":true,"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/users\/3"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/media\/1110"}],"wp:attachment":[{"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/media?parent=1109"}],"wp:term":[{"taxonomy":"glospa-glossary-category","embeddable":true,"href":"https:\/\/montreal.ventures\/en\/wp-json\/wp\/v2\/glospa-glossary-category?post=1109"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}