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Ask HN: Technical/Code Validation as part of an investment round.

Hi all,

My startup is actively pursuing seed investment, and I was wondering about technical/code validation as part of due diligence. Is it standard practice for code to be examined by a third party prior to investment being made? I would imagine in biotech, green tech, clean tech, etc that it would be fairly standard to get the core technology validated by independent experts. But is this normal for a strictly software startup? If placed in this position, what sort of protections should be put in place to protect both parties?

( 2 comments | on HN )
Re:Ask HN: Technical/Code Validation as part of an investmen... by goshon on Thursday September 20, 2012 @11:06AM (#4548901)
The technical validation is being done at the architecture level usually, and the due diligence is usually focused on the background and tech skills of the entrepreneurs.
Re:Ask HN: Technical/Code Validation as part of an investmen... by rabidsnail on Thursday September 20, 2012 @10:08AM (#4548589)
My understanding is that it's standard for acquisitions but not for funding rounds.