The situation
A company the fund had tracked for a year opened a Series A with a lead already circling. The data room had two hundred and twelve files. The fund had eleven days to decide whether to fight for allocation. Its usual diligence took three to four weeks, most of it one investment manager reading.
What changed
On day one, every file in the room was labelled as it was uploaded. Most came out Internal or Confidential. Bank statements, payroll and the founders' personal guarantees came out Restricted. The manager confirmed the labels in the Needs-you queue in about forty minutes, upgrading two customer contracts the classifier had left at Internal.
Then the fund's standing checklist, thirty-one steps across eight sections, was worked step by step. For each, the plan showed what would be read and what would be held back. Burn and runway is the step everyone remembers: it wanted the bank statements and could not have them. The plan said so — restricted, a derivative exists but has not been approved. The manager approved a monthly-totals derivative, produced by Navent’s rules with the account details removed, and the step ran against that instead of the raw statements.
The first week we used it on a live deal, the memo was done before the second founder call.Investment manager
The findings
Thirty-one findings arrived pending over five days. The manager accepted twenty-five, challenged four with a note, and rejected two. The challenged ones were re-run with the note in scope; three came back changed. The two rejected findings stayed on the record and appear in the memo under not in the memo, with the reason.
Two findings mattered. The stated ARR included a pilot that the contract said was cancellable on thirty days' notice. And the option pool in the pro-forma was half a point short of what the term sheet required. Both were raised with the founders on the second call, with the source passage on screen.
The decision
The fund committed on day nine. The memo went to the investment committee with every claim cited and a page of what had been left out and why. The committee asked one question about a source. The manager clicked the citation and the passage came up.