Catalyst Fund releases report on investor due diligence

Global Tech accelerator Catalyst Fund has released a new report on remote due diligence and inclusive opportunities for investors.

The company released the report, titled Remote Due Diligence Guide,  on 25 May.

The report offers insight into remote due diligence best practices used by investors in the wake of the COVID-19 pandemic

It also identifies key fintech product areas that have the potential for recovery and tips on how investors can evaluate startups better.

“We created this guide to share what we and our community have learned over the last 12 months about remote due diligence and the next opportunity areas for inclusive fintech, as we look hopefully ahead toward the new normal, and continue to invest in founders with the potential for transformative impact,” Catalyst Fund Managing Director, Maelis Carraro said in a statement.

Key insights from the Catalyst Fund report

The report compiled insights from more than 75 members of Catalyst Fund’s Circle of Investors. It also included critical input from three fintech investors, namely; Accion Venture Lab, Flourish Ventures, and Quona Capital.

The report that effective remote due diligence should focus on startup teams, product, market, and financials.

While insurtech has seen a steady increase in the sector, nearly a quarter of new initiatives do not survive. This is due to problems with customer acquisition not enacting cost-effective service delivery.

In addition, the report found evidence that households respond to past incidents by saving more. To counter this, startups should focus on building trust, keeping their customers, and generating revenue.

“Savings and investments are a good use case to build financial education and awareness,” Johan Bosini of Quona Capital said.

“Having savings can prevent someone from needing an expensive loan and prevent the need to make quick, uninformed decisions in a crowded lending market that may have detrimental effects when savings are low.”

You can download and read the Catalyst Fund Remote Due Diligence Guide here.

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Featured image: Charles Forerunner via Unsplash