Vetting Process

Home Vetting Process

SEC/FINRA Screening Conducted by Impartial Third-Party

Any serious violations by an officer or entity holding more than a 20% ownership stake will result in disqualification from being featured in the investor marketplace. The sponsors will disclose the results of this “bad actor” check to interested investors if they ask for it.

Financial Review

Model Evaluation including a review of the cost and revenue assumptions for normalcy over a three to five-year time period, a review of founders and key personnel’s compensation/retention plans, and cross check proforma calculations for accuracy.

Review of any current financials to make sure P&L and balance sheets are up to date, a review the cap table and consultation with founder to make sure there is a strong cap table management strategy in place to facilitate present and future raises, and disclosure of any founder contributions in terms of assets, personal guarantees, capital, or time invested in the furtherance of the enterprise.

Business Entity Review

The entity seeking to raise capital must be established and deemed a suitable vehicle for raising capital.

Business Strategy Overview

The sponsor is expected to have a well rounded and experienced leadership team as reflected in their bios. Bios will be centered on relevant industry experience and prior successful exits. The sponsor must make a pitch deck that accurately portrays the opportunity in an engaging manner in 15 slides or less. Sponsor must also relay this information in a one page “family office” flyer.

The Sponsor must have an executive summary that reflects an amplification of the pitch deck. The business plan must reflect careful research into the sponsors intended/current market. The business plan will be at least several pages long to ensure it utilizes quantifiable metrics that establish measurable benchmarks for enterprise success.

Sponsor will articulate a well thought out potential exit strategy with a timeline that is amenable to prospective investors entering into this round.

Licensure & Permit Review

The sponsor must show the disposition of any required licenses/permits for their business. If a license cannot be obtained right away, the sponsor must lay out a plan of action to demonstrate an understanding of the process to secure any other needed licenses in a timely manner.

The sponsor must demonstrate they have analyzed and understood all licensure compliance requirements in any area they intended to operate in the near future.

If the transaction involves real estate the sponsor must account for the disposition of required entitlements. They should have a plan in place for any lobbying or governmental affairs work that may be necessary for entitlement success, and an appropriate understanding of the expertise needed with reasonable estimates for consultants such as architects, engineers, etc.

Use of Funds

The sponsor must have an itemized list explaining the intended use of funds in a manner that reflects a clear understanding of appropriate commercial priorities. Sponsor will make sure there is a clear explanation and recording of how any previously raised capital was spent.

Offering Documents

Require the sponsor show proof professional consultation was sought in drafting the PPM/Subscription agreements and/or note, SAFE, etc. Make sure the offering rests on rational assumptions surrounding valuation, industry norms, risk, ROI, etc.