Our Due Diligence process at Malpani Ventures

At Malpani Ventures, we have always believed that investing in a company is not a transaction. It is the beginning of a long-term partnership.

For many founders, the diligence phase after a term sheet can feel intimidating. It is often seen as a hurdle to cross, a process driven by checklists, legal documents, and financial scrutiny. We think about it differently.

For us, due diligence is not about “catching” founders or creating friction in the fundraising journey. It is about establishing the foundational ethos of the partnership we are about to build together. When we invest, we do so with an ownership mindset. We are not looking for short-term gains or opportunistic outcomes. We are entering the journey with the intent to stand alongside founders through the long arc of company building.

That is precisely why our due diligence process is designed to be rigorous in principle, but collaborative in practice.

Once a term sheet is signed, we undertake a comprehensive financial due diligence and legal due diligence process. This includes a review of financial statements, statutory compliances, corporate governance, contracts, cap table integrity, intellectual property documentation, employment structures, and any material regulatory considerations that may impact the business.

However, the objective is not to create an adversarial environment.

The objective is to ensure that the business is set up on strong foundations, with the right compliance framework, governance discipline, and legal hygiene in place. We believe this is not just important for the current round but critical for the company’s long-term growth. As businesses scale, unresolved non-compliances and structural issues often become disproportionately expensive, especially during later-stage fundraising, strategic partnerships, or exit processes.

By addressing these aspects early, we help founders build a stronger company for the future.

One of the core principles that defines our process is transparency. From the very first conversation with founders, we are upfront about how we work and what our usual process is. We believe that clarity reduces anxiety and creates trust.

This is why our standard term sheet template , our standard Shareholders’ and Subscription Agreement (SSHA) and the IRL / due diligence request list is made available on our website, so that founders can prepare themselves well before the formal diligence begins.

We do this intentionally.

Too often, founders encounter surprises during fundraising - documents they were not expecting, legal clauses they had never seen before, or requests that seem to emerge late in the process. We believe this is avoidable.

By making our documentation and diligence expectations transparent from the outset, we allow founders to prepare with confidence, align their teams and engage with the process proactively.

We recognize that founders are simultaneously running and scaling a business while raising capital. The diligence process should not become a distraction from core execution. Our effort is always to ensure that the process remains as non-confrontational and efficient as possible.

Our diligence lens prioritizes issues that can materially impact governance, compliance, ownership, scalability, or future fundraising. We do not believe in creating noise around low-impact items that can be resolved through operational clean-up over time.

This focus helps create a win-win outcome.

For founders, it means a process that is predictable, collaborative, and respectful of their time.

For us, it means entering the investment with conviction and confidence that the business is structurally sound.

We invest with the belief that enduring companies are built over years, often decades. That requires alignment, trust, and governance discipline from day one.

When we say we invest with an ownership mindset, we mean that we think like long-term partners in the company’s journey. We want to be there with founders through moments of scale, challenge, and transformation.

Non-compliances rarely remain isolated issues. Left unresolved, they tend to surface at the most critical moments - during future rounds, strategic M&A discussions, IPO preparation, or regulatory reviews. By institutionalizing strong governance early, we help ensure that such issues do not become obstacles in the company’s growth journey.

We see it as the first meaningful step in building a relationship rooted in trust, shared ambition, and a mutual commitment to creating enduring businesses.

For founders who work with us, our promise is simple: we will always strive to make the process transparent, thoughtful and accommodative while staying focused on what truly matters.