What investors look for in legal due diligence around Series A
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Investor legal due diligence becomes more serious around Series A than the speed-focused seed stage. It confirms no major problem surfaces after investment, and preparing early keeps the fundraising schedule on track.
Shares and corporate procedure
DD starts with the articles, register and shareholder register, checked against past share issuances, class shares and instruments such as J-KISS. Missing payment certificates or board minutes slow the review, and where stock options exist, the issuance resolution and consistency with qualified-option requirements are also checked. Gathering this history before Series A is worthwhile since early-stage procedures are often rushed.
Key contracts and intellectual property
Investors check the contracts underpinning revenue and the product, including key customer and vendor agreements and SaaS terms of use. Where development is outsourced, whether IP in the deliverables belongs to the company matters, including code made before incorporation. For AI services, training data, external AI tool terms and third-party rights issues may also be checked.
Labour and outsourcing relationships
Employment contracts, work rules and confidentiality agreements come under review. Because early members often start on flexible terms, whether a relationship is employment or outsourcing, and whether IP belongs to the company, can be unclear, and investors are concerned about future labour disputes or IP risk.
Personal data and terms of use
For services handling personal data, whether the privacy policy matches actual use, and whether third-party provision or cross-border transfer is explained properly, are checked, along with whether the terms of use fit the business. What matters is whether documents match actual operations, not just whether they exist.
Building a data room before Series A
Building a data room early, with documents organised by folder, surfaces the company's own gaps as much as it helps investors, including missing documents, outdated contracts and unorganised stock option records.