Steps for Getting Your Startup Investor-Ready

Authored by: Matt Shrimpton & Bob Baker, Partners at Peak Corporate Counsel

Startups need money, and usually a lot of it. Building a team and an MVP can get expensive, and at some point in the lifecycle of most startups, they will seek outside capital. Most of these raises will involve equity financing – receiving money in exchange for a percentage of ownership in the company. Investors will want to put their money in a business which provides a unique and valuable product or service, backed by a solid founding team.

Following on the heels of these two requirements is a clean and understandable corporate record. We’ve put together the following steps to help founders get their company’s corporate record in shape prior to working with investors, so that investors’ questions are answered more easily. 

1. Start With a Clean Cap Table

Your cap table is the single most accessible snapshot of your company’s ownership. It outlines who owns shares, options, or convertible securities—and how those holdings translate into ownership percentages. A clean cap table ensures clarity for everyone, while a disorganized one can cause confusion, mistrust, and even legal disputes.

Action steps:

• Confirm accuracy: Reconcile your cap table with restricted stock purchase agreements, redemptions, stock option grants and other equity awards, and vesting schedules.

• Record every transaction: Each issuance of stock, option grant, SAFE, or convertible note must be properly approved by the board of directors and documented.

• Avoid informal promises: Verbal promises around equity or undocumented side deals can often turn into serious legal disputes, since the terms are not written down and understood by everyone involved.

• When helpful, use the apps: Platforms like Carta or Pulley help track equity automatically, issue electronic stock certificates, and maintain audit-ready records.

A transparent, up-to-date cap table reassures investors that your company is well-managed and reduces surprises during due diligence.

2. Organize Your Corporate Records

When investors perform legal diligence, one of the first things they’ll request is your corporate record book – the legal backbone of your company. Missing or inconsistent documents can slow down or even derail a transaction.

Key documents to organize:

• Formation documents: Certificate of incorporation, bylaws (or operating agreement), and amendments.

• Board and stockholder actions: Written consents, meeting minutes, and resolutions approving major decisions like financings, equity grants, or officer appointments.

• Equity records: Stock purchase agreements, option grant documents, and vesting schedules.

• Employment and contractor agreements: Make sure all contracts are signed, stored, and easily accessible.

• Securities filings and good standing: Federal and state securities compliance, state annual reports, and franchise taxes / annual filing fees must all be current.

Investors expect a company that keeps its house in order. A complete, well-structured corporate record system signals professionalism and reduces the risk of surprises later.

3. Lock Down Your Intellectual Property

For most startups, intellectual property (IP), which includes code, brand, algorithms, designs, or trade secrets, is often the core asset that investors are buying into. If your company doesn’t clearly own its IP, that’s a red flag that can reduce investor confidence and even stall a deal.

What to check:

• IP assignments: Every founder, employee, and independent contractor should sign a Proprietary Information and Inventions Assignment Agreement (PIIAA) that assigns to the company all IP created in connection with their work.

• Third-party code and licenses: Review your use of open-source software and third-party content. Noncompliant use or restrictive licenses can jeopardize ownership.

• Trademark and patent filings: Register key trademarks and file provisional or utility patents if applicable. This strengthens your legal protection and boosts investor confidence.

• Trade secrets: Implement policies around confidentiality, data access, and document retention to preserve your trade secret protection.

In short, if someone other than the company has a claim to your product or technology, make sure to resolve it before providing investors access to your record.

4. Get Financially Ready

Financial diligence is where investors separate well-run businesses from those running on intuition. Your books don’t need to be perfect, but they must be accurate, complete, and defensible.

Steps to take:

• Clean up your books: Reconcile accounts, correct errors, and ensure your bookkeeping reflects reality. Consider using an outsourced accounting firm experienced with startups.

• Separate personal and business finances: Using personal accounts for business expenses can raise tax and legal risks and complicate diligence.

• Track key metrics: Investors want to see metrics that demonstrate growth and efficiency—customer acquisition cost (CAC), lifetime value (LTV), burn rate, runway, gross margins, and churn.

• Build financial projections: Have realistic forecasts backed by data and assumptions you can explain.

• Be ready to share: Investors may ask for historical financials, tax filings, bank statements, and proof of debt obligations.

Strong financial hygiene not only accelerates the fundraising process but also positions your company as a disciplined, investor-ready organization.

5. Build Your Data Room Early

A data room is a secure, centralized folder (often cloud-based) that contains all the information investors will request during due diligence. Building your data room early means you can respond quickly to investor requests and show that you operate with foresight and discipline.

Include key materials:

• Corporate documents (charter, bylaws, board minutes)

• Equity (cap table, option plans, SAFE or note agreements)

• IP documents (assignments, registrations, filings)

• Financials (P&L, balance sheet, projections, tax returns)

• Key contracts (customer, supplier, and employment agreements)

• Legal and compliance documents (licenses, permits, litigation disclosures)

Use organized folders, label everything clearly, and keep sensitive data accessible only on a need-to-know basis. The goal is to make the diligence process smooth, professional, and confidence-inspiring.

Wrap-Up: Build for the Future, Not Just the Fundraise

Getting investor-ready isn’t just about preparing for a financing round; it’s about building a company that can withstand scrutiny and scale responsibly. The same discipline that impresses investors will serve you well in future audits, acquisitions, or IPOs.

Clean records, clear ownership, and sound financials are signs of a founder who treats their startup like a real business. And that’s exactly the kind of founder investors want to back.

If you’re preparing for your first (or next) round of fundraising, our team can help conduct a legal audit, organize your documents, and make sure your company is ready to raise with confidence.

About the Authors: Matt Shrimpton and Bob Baker are startup attorneys, helping founders and their companies grow from formation to exit. Matt’s emphasis is on outsourcing and tech licensing, corporate governance, trademarks, and commercial agreements.

When not in the office, Matt enjoys spending time outdoors, paddling on the ocean and hiking in the White Mountains, or on walks with his wife and small pug. Bob’s focus is on venture financings, M&A, corporate governance, and strategic legal guidance. When he’s not advising innovators, Bob can be found at networking events, playing rugby, or hiking with his kids.