Corporate & Legal Hygiene
Do not wait for a term sheet to build your data room. Ensure your cap table is spotless, IP assignments are finalized, and key employment agreements are signed.
Funding Readiness for Health Tech Startups
Practical tips for navigating due diligence and the capital markets.
The Due Diligence Mindset
Preparation is part of the product story
Building a great health tech product is only half the battle. When it comes time to raise capital, the friction often lies in the diligence process. Being prepared does not just accelerate funding; it protects your valuation.
This is not just about checking boxes. It is about demonstrating operational maturity to institutional investors and giving them confidence that the company can handle the scrutiny that follows serious capital formation.
Practical Tips
Funding prep that reduces avoidable friction
Financial Clarity
Institutional investors require a clear bridge from historical financials to future projections. Ensure your financial models are tied to realistic, defendable operating metrics.
Regulatory & Compliance Roadmap
In health tech, your regulatory strategy is an investment gatekeeper. Be prepared to clearly articulate your FDA pathways, HIPAA compliance architecture, and data privacy moats.
Fiduciary Governance
Showing maturity early on pays dividends. Building a strong advisory board or having independent voices demonstrates that founders are open to guidance and fiduciary oversight.
Sample Early Stage Startup Due Diligence Checklist
Start with good bones
As an early stage startup, key diligence items focus on proper legal and business setup, making sure the company has good bones. The sections below reflect this. As your company grows and matures, other topics become more relevant, including tech stack, products and services, sales and marketing, taxes, regulatory strategy, and other operating details.
I. Corporate Matters
- The Company's certificate of incorporation and bylaws, including any amendments.
- Minutes or other records of all meetings or actions of the board of directors, including any board committees, and the Company's shareholders.
- All written communications to directors or shareholders during the last three years.
- Evidence of qualification to conduct business in all jurisdictions in which the Company is or should be qualified to do business, has an office or employees, or is otherwise operating.
- Most recent business plan and all offering memoranda prepared in connection with financings, if any.
- Organizational chart of the Company, which details branches, subsidiaries and any other ownership interest in another company or entity.
II. Capitalization
- A current list of shareholders, option holders, warrant holders and other persons that own securities of the Company or that have any rights regarding the securities of the Company, including holders of convertible notes, by type of security and on an as-converted basis.
- Copies of all certificates, warrants, notes, etc., representing all issued securities of the Company.
- Transaction documents from the Company's previous equity financings, including exhibits and disclosure schedules.
- Agreements, offering memoranda and other materials relating to the purchase, repurchase, sale or issuance of securities.
- Agreements relating to voting, transfer restrictions, preemptive or preferential rights, registration rights and other stockholder rights.
- Information about claims made by any person asserting a right to an equity interest in the Company.
- Evidence of qualification or exemption under applicable federal and state securities laws for all issuances and transfers of Company securities.
III. Intellectual Property
- A list of all patents, trademarks, copyrights, applications, service marks, trade names, domain names, trade secrets, licenses, processes, technology and similar proprietary rights owned or licensed by the Company or used in its business.
- Any licenses or other agreements with respect to proprietary rights of the Company or third parties, or the development of inventions, technology or intellectual property.
- A list of third-party technology incorporated in the Company's products and services.
- Form of proprietary information and invention agreements signed by past and present employees and consultants, plus executed agreements for founders, key employees and consultants.
- List of exclusions from proprietary information and invention agreements, if any, including the name of the applicable service provider.
IV. Financials
- Detailed quarterly financial statements for each quarter in the past three fiscal years and most recent year-to-date period.
- Monthly or quarterly internal financial and operational management reporting packages for the past three fiscal years and year-to-date period.
- Detailed quarterly budgeted, planned or forecast financial statements for the remainder of the year-to-date period and next three fiscal years.
- Description of the process and methodology used to develop the forecast or projection.
- Comparison and reconciliation of actual results to budget for the last three years and commentary on significant variances.
- Details of financial instruments, off-balance sheet financing arrangements or other transactions not reflected on the financial statements.
V. Management, Employees and Consultants
- A list of officers and directors, including whether any officer is not devoting all business time to the Company.
- A copy of the Company's standard offer letter.
- Agreements, understandings or proposed transactions between the Company and officers, directors, employees, consultants or shareholders.
- Headcount by department and location, if any, and description of planned changes in headcount or compensation practices.
- Employee benefit plans and arrangements, including bonus, retirement, pension, deferred compensation, profit sharing and management incentive arrangements.
VI. Legal and Regulatory
- Documents and correspondence relating to pending or threatened actions, suits, proceedings or investigations involving the Company, executive officers or directors.
- Any orders, injunctions, judgments, decrees, settlement agreements or similar matters.
- Significant permits, licenses and similar authorizations relevant to the operation of the Company's business.
- Other correspondence with governmental or regulatory authorities, including tax audits, investigations, disputes, deficiencies, penalties and environmental matters.
VII. Agreements
- Documents or agreements evidencing existing or proposed indebtedness or other financing arrangements, plus material lender or debtholder correspondence.
- Form material contracts with suppliers or customers, or otherwise related to the sales channel, and any material contracts that do not follow the form.
- List of top 15 customers and suppliers for the Company as a whole, with applicable agreements governing such relationships.
- Copies of agreements relating to contingent sales to customers or trial arrangements with potential customers.
- Joint venture or partnership agreements.
- Documents relating to any proposed acquisitions or dispositions.
- Contracts restricting the Company's ability to compete, committing the Company to a line of business, or confidentiality and nondisclosure agreements binding the Company.
- Agreements requiring consents or approvals in connection with the financing.
- Any arrangements with a broker or finder in connection with this or other financings.
- Agreements involving amounts in excess of $25,000.
- Other agreements material to the business, outside the ordinary course of business, or not at arms-length.
- Notices of breach or default under any material agreement.
VIII. Other
- Reports or studies prepared by the Company or outside consultants on the Company's business or financial condition, including valuation reports.
- Summary of insurance policies held for the benefit of the Company, directors, officers or employees, and a summary of claims under those policies.
- Any other information important to understanding the Company, financial condition, financial performance, prospects, products or industry.
Grounded in Reality
Experience at the intersection of tech and finance
The Intersection of Tech & Finance
This guidance is rooted in over 20 years of experience bridging technical engineering and high-stakes financial strategy.
Transaction Pedigree
Drawn from executing over $15 billion in total transaction value across M&A, IPOs, and debt/equity financings.
Representative Transactions
A broad set of health tech, medical device, healthcare services, software, real estate and corporate finance transaction experience.
Operational Empathy
Perspective from driving growth as VP of Corporate Development at Elekta, advising CareShield AI, Vigilant Software and morriganAI, and currently building as Co-Founder of Operis Health AI.
Representative Transactions
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