Seed round due diligence: the documents a lead investor asks for

Seed round due diligence is the review a lead seed investor carries out before committing money to an early-stage company. It is lighter than later rounds: there is little history to audit, so the investor concentrates on how the company was formed, who owns its shares and its intellectual property, and whether the early numbers hold up. The documents behind that review are the company’s charter and consents, founder stock and vesting papers, the cap table with every SAFE and note, IP assignments, a short financial pack, early customer evidence and basic team records.

The depth varies more at seed than at any other stage. An angel writing a small check on a standard post-money SAFE may read only the deck and the cap table. A seed fund leading a priced round with a board seat will send its law firm a request list. This guide covers the second case, since a founder who prepares for it is ready for the first as well.

How does seed diligence differ from pre-seed and Series A?

The request list grows with each round, and the bars show how. Each bar counts the document sets in our checklist that are usually requested by the end of that stage, so the seed bar includes everything from pre-seed.

The review times are a rough guide drawn from founder and law firm practice, not a statistic. A clean room shortens each of them.

Which documents does a lead seed investor ask for?

The seed request list is short enough to fit on one screen. The window below is the seed room we would set up: seven folders, with the cap table highlighted because it is where most questions start.

Here is the same list as a priority table: what a lead almost always asks for, what it often asks for, and what helps but is rarely required at seed.

What do investors look for in the cap table and SAFEs?

At seed, the cap table is often a spreadsheet plus a stack of SAFEs signed over a year or two. The investor wants a single fully diluted view: founders’ shares, the option pool, every SAFE and note with its cap and discount, and any promised but unissued equity to advisors or early employees.

Since Y Combinator introduced the post-money SAFE in 2018, it has become the standard instrument for early rounds. It is simple to sign, but a stack of them changes the picture. A post-money SAFE fixes the holder’s percentage at the cap, so each additional SAFE dilutes the founders rather than the earlier SAFE holders. A lead seed investor will run the conversion math before agreeing a price; you should run it first.

Repeat the calculation for each SAFE, then add the results to a pro forma cap table. If one SAFE carries a most favored nation clause, check whether later SAFEs with better terms have already changed it. Our page on SAFE rounds covers the documents a SAFE investor expects, and the SAFE conversion calculator has the full method and a worked example.

Why does IP assignment matter so much at seed?

Early code is often written before the company exists, by founders on personal laptops and by friends or freelancers paid in cash or promises. If any of them never signed an assignment, the company may not own part of its product. At seed this is still cheap to fix: the people are reachable and goodwill is high. Two years later a departed cofounder or a freelancer abroad may be hard to find or may ask for something in return.

Our IP due diligence page lists the follow-up questions investors raise when a founder came from a university lab or a large tech employer.

What financial documents does a seed investor want?

A seed investor does not expect a finance function. It does expect the founder to know the numbers. A short, consistent pack beats a large, messy one.

• Monthly P&L since launch. Bookkeeping software exports are fine. Revenue should be recorded when earned, and founder salaries should be visible even if small.
• Bank statements. The last six to twelve months, to tie cash to the P&L.
• An 18-month plan. Headcount by month, burn and the milestone the round is meant to reach. The runway and raise timing tool gives a starting point.
• Use of funds. One page: hires, product work, go-to-market and the buffer.
• Debts and commitments. Any loans, credit cards in the company name, deferred salaries or unpaid invoices.

If you have revenue, add a simple metrics sheet: monthly revenue, customers, churn and how each is defined. The definitions matter more than the decimal places.

Seed round red flags and how to fix them

Most seed diligence problems are not hidden scandals. They are paperwork that was skipped when the company was three people in a kitchen. The table lists the ones investors and their counsel raise most, with the usual fix. Treat the fixes as starting points for a conversation with your lawyer.

How ready is your seed data room?

The readiness score below weights nine items the way a seed lead tends to: the cap table and IP assignments count most, security documents least. Tick what you already have in place. A score in the high range means a lead fund can start reading on day one.

The weights are our editorial view, set out on the readiness score page. Use the result to decide what to fix first, not as a grade the investor will see.

How long does seed due diligence take?

A seed review on a clean room can be done in a week or two. The usual sequence looks like this:

Where it drags, the cause is nearly always a missing signature or a cap table that does not reconcile. The due diligence timeline calculator shows how open issues add weeks.

Where should seed documents live?

A founder can run a small SAFE round from a well-organized shared folder. Once a seed fund and its counsel join, the case for a proper room gets stronger: per-folder permissions, view-only files for the cap table and contracts, a watermark with the reader’s email and a record of who opened what. Our comparison of Notion, Google Drive and a data room goes through the trade-offs in detail.

The seed round use case ranks rooms for this stage, and the startup data room pricing guide shows what a three-month round costs.