A business which wants to attract foreign investments must present a business plan. But a business plan is the equivalent of a visit card. The introduction is very important – but, once the foreign investor has expressed interest, a second, more serious, more onerous and more tedious process commences: Due Diligence.
“Due Diligence” is a legal term (borrowed from the securities industry). It means, essentially, to make sure that all the facts regarding the firm are available and have been independently verified. In some respects, it is very similar to an audit. All the documents of the firm are assembled and reviewed, the management is interviewed and a team of financial experts, lawyers and accountants descends on the firm to analyze it.
First Rule:
The firm must appoint ONE due diligence coordinator. This person interfaces with all outside due diligence teams. He collects all the materials requested and oversees all the activities which make up the due diligence process.
The firm must have ONE VOICE. Only one person represents the company, answers questions, makes presentations and serves as a coordinator when the DD teams wish to...
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