How to use this checklist: Work through each section before you begin investor conversations. Items marked with a tick box require active preparation — they cannot be pulled together during due diligence without creating delays and signalling weak financial control. A clean sweep here does not guarantee a successful raise, but it removes the avoidable reasons for deals to fall over.
1. Financial Model & Projections
- Three-statement model integrated and balancingP&L, balance sheet, and cash flow statement linked and reconciling — net income ties to retained earnings; cash movement ties to balance sheet cash.
- 36-month forecast with monthly granularity for first 12 monthsMonthly detail for Year 1; quarterly acceptable for Years 2–3. Investors will scrutinise the near-term assumptions most closely.
- Driver-based assumptions tab documenting all key inputsEvery material assumption (growth rates, pricing, churn, headcount, COGS drivers) documented in a single assumptions tab — not buried across multiple sheets.
- Scenario analysis: base, upside, and downside casesThree scenarios with clearly labelled assumptions. Downside should be genuinely conservative — investors will ask what happens if growth is 30–40% below plan.
- Waterfall from revenue to EBITDA clearly visibleGross margin, S&M, R&D, G&A, and EBITDA all visible as both £ and % of revenue. All adjustments between EBITDA and cash flow explained.
- Unit economics embedded: CAC, LTV, payback period per cohortCustomer acquisition cost by channel; lifetime value by customer segment; blended and channel-specific payback periods. Shown historically and projected.
- Headcount plan linked to P&L with fully loaded cost assumptionsEvery hire in the plan reflected in the P&L with employer NI, pension, and benefits loaded. Role-level detail for first 12 months at minimum.
- Funding use of proceeds showing 18–24 month runway post-raiseThe model should show exactly how the raise amount is deployed, by category, and demonstrate at least 18 months of runway at the base case burn rate.
2. Key Performance Indicators
- MRR/ARR with 24-month history and month-over-month growth rateInvestors want to see the growth trajectory, not just the current number. Include a chart. Flag any one-off items that distort the trend.
- Net revenue retention (NRR) calculated and benchmarkedNRR above 100% is a strong signal of product-market fit for SaaS. Benchmark against sector peers and be prepared to explain the components.
- Customer acquisition cost (CAC) by channelBlended CAC is insufficient — investors want channel-level granularity to assess efficiency and scalability of the go-to-market motion.
- Gross margin by product line — not just blendedBlended gross margin can mask cross-subsidisation. Show margin by product, and include a bridge from headline revenue to contribution margin.
- Churn rate: both logo churn and revenue churnLogo churn (% of customers lost) and revenue churn (% of ARR lost) often diverge significantly. Both tell part of the story; neither alone is sufficient.
- Burn multiple calculated for last 6 monthsNet burn divided by net new ARR. A burn multiple above 2x will attract significant investor scrutiny in the current market. Have a clear narrative if it is elevated.
3. Data Room Structure
- Data room folder structure createdStandard structure: Financials / Legal / Commercial / Team / Product / Regulatory. Use a virtual data room (VDR) platform — not Google Drive for sensitive documents.
- Last 2 years audited or reviewed accounts uploadedIf audited, full audited accounts including notes. If reviewed by accountants, include the accountant's report. Unaudited management accounts are insufficient for later-stage rounds.
- Management accounts for the last 12 months — monthly formatConsistent format, month by month. Should include P&L, balance sheet, and cash position. Unexplained variances will raise questions in DD.
- Cap table: current, fully diluted, with all instruments reflectedOrdinary shares, preference shares, convertible notes, SAFEs, options (granted and ungranted), warrants. Fully diluted ownership clearly shown.
- Board minutes for last 12 months — redacted and uploadedRedact any commercially sensitive or legally privileged content. All minutes should be signed. Missing minutes are a common DD red flag.
- Contracts: top 10 customer agreements and key supplier contractsSigned agreements. Flag any unusual termination rights, change-of-control clauses, or revenue recognition complexities in an index document.
- IP ownership: assignments, employment agreements, any third-party claimsAll IP created by founders, employees, and contractors should be formally assigned to the company. Any open questions on IP ownership must be resolved before raising.
- Regulatory licences, FCA correspondence, and compliance historyInclude any FCA or regulatory authorisations, permissions variations, and any correspondence with regulators. Clean regulatory history is a significant positive signal.
4. Legal & Corporate
- Articles of association up to date and consistent with shareholder agreementsConflicts between the articles and SHA are a common legal DD finding and can delay completion significantly. Have legal counsel review both together.
- All previous round documents filed at Companies HouseAllotments, SH01 filings, updated PSC register. Investors' solicitors will conduct a Companies House search; unexplained discrepancies will need to be explained.
- Option pool calculated: ungranted options, vested, unvestedTotal pool size, shares granted to date, vesting schedule summary, and ungranted headroom. Include EMI valuations if applicable.
- SEIS/EIS advance assurance in place or obtained if applicableFor early-stage rounds where SEIS/EIS is relevant, advance assurance from HMRC should be in place before investor conversations begin — not after term sheet.
- Intellectual property: trademarks, patents, software ownership confirmedRegistered IP schedule with jurisdictions, expiry dates, and renewal status. Unregistered IP (trade secrets, copyright, database rights) also documented.
- Employment contracts: all key persons on current contracts with IP assignmentContracts should include IP assignment, confidentiality, and non-solicitation clauses. Garden leave provisions for senior roles are expected by institutional investors.
5. Investor Narrative
- Pitch deck: problem, solution, market, traction, model, team, ask10–15 slides. The financial story in the deck should be consistent with the financial model — same numbers, same framing, same assumptions.
- Financial narrative aligns with deck — same numbers, same storyA common mistake is a pitch deck built by the founding team and a financial model built separately by finance. Every number in the deck must tie back to the model.
- Comparable transactions identified for valuation framingRecent comparable raises (sector, stage, ARR multiple, growth rate) to anchor the valuation conversation. Prepare a short comps table for the CFO discussion.
- Use of proceeds clearly articulated by category and milestoneCategory breakdown (product, headcount, sales & marketing, working capital) with the key milestones each tranche of capital is designed to achieve.
- Key risks identified and mitigants preparedInvestors will surface the risks anyway — being proactive signals maturity. Identify the top 5–6 risks and have a crisp, honest mitigant for each.
- Board composition and governance structure documentedCurrent board, observer rights holders, reserved matters, and any planned changes post-raise. Institutional investors will want to understand governance before committing.
6. Operational Readiness
- Reference customers identified and briefedTwo or three customers willing to take investor reference calls. Brief them on what investors will ask — they should be able to speak to ROI, not just product satisfaction.
- Finance team capacity: who handles DD queries during the processA fundraising process generates hundreds of data requests. Assign a named owner for DD coordination — typically CFO or senior finance person — with protected time.
- Monthly close process: can produce management accounts within 10 working daysInvestors will ask for up-to-date management accounts during DD. If your close takes 25 days, that becomes a DD delay and a due diligence finding in one.
- Bank accounts: signatories, controls, and FX exposure documentedAll accounts listed, signatories confirmed, payment authorisation thresholds in place. FX exposure quantified and hedging approach (if any) documented.
- D&O insurance in place or quotedDirectors and Officers insurance is expected by institutional investors — often a closing condition. Get it in place or have a binder letter ready before close.
- Advisor team confirmed: legal, accountants, and corporate finance supportInvestors will want to know who your legal advisors are. A reputable law firm on your side of the transaction signals the company takes the process seriously.
