How VCs Do Tech Diligence
Posted by Pierre de la Fortune on May 19, 2015 @ 12:01 a.m.
Written by Mark Peter Davis
If you’re building a new ecommerce site, applying existing technology investors will gamble on the tech either working now or being in a state that can be fixed.
If the company, however, is developing new & complex technology VCs will rely on in-house or outsourced technical resources to conduct diligence. If they have an engineer on the team he/she might dive into the code and grill the CTO for a few hours. If they don’t they might hire an ex-CTO in the space to do the same. In extreme cases the technical due diligence teams will do a full code review, but in my experience that's not common.
Either way technical due diligence is ultimately a sanity check on the approach, processes, and resources being deployed to develop the code. Usually tech diligence isn’t going to be a deal killer, but thorough VCs pay careful attention to it and you should be ready to help accommodate the process when asked.
For more info please visit: http://www.markpeterdavis.com/getventure/2011/12/how-vcs-do-tech-diligence.html
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