Thoughts on startups by investors that
fund them & entrepreneurs that run them

What? Avoiding Undue Diligence? Seriously?

I suspect this is one of those provocative posts that gets misquoted, misaligned and misunderstood, and definitely not to be taken at face value. Still, read  Avoiding Undue Diligence: My Strange Approach To Angel Investing, in which Dharmesh Shah argues against due diligence in angel investment.

Dharmesh Shah on Avoiding Undue Diligence

I don’t subscribe to the idea in the title. And I’m familiar with Robert Wiltbank’s exhaustive research on angel investment — as in this summary in TechCrunch — that shows a serious correlation between more hours of due diligence and higher incidence of successful exists.

Still, Dharmesh’ refreshingly contrarian, and unabashedly honest, analysis is worth a good read. And the comments are lively too.

Furthermore,  I’m really intrigued with this quote near the bottom:

There’s no such thing as too many companies starting up.  But, there is such a thing as not enough companies shutting down.

Now there’s a thought worth following up.

Written by Tim Berry

user Tim Berry

Tim is the founder of Palo Alto Software and bplans.com, the co-founder of Borland International, and the official business planning coach at Entrepreneur.com. He has been called the "Obi-wan Kenobe of business planning" and "The Father of Business Planning." He is a serial author of books and software on business planning.

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