We have more local participation in investment deals in Nigeria but I’ve found that many Angel investors still do not understand what they need to look out for when diligencing a company. You should get a lawyer but here’s a thread of the top issues to look out for.

1. Who owns what? At the very least, the founders, engineers and employees of the company should have an IP Assignment agreement with the company. If not, the company owns nothing and you are investing in an empty shell.

2. Still on ownership, the founders should have a Founders Agreement that delineates their roles, responsibilities and ownership structure. If there’s a Vesting Schedule, the founders should sign a doc that allows the company exercise it’s repurchase option without hassle.

3. If the Nigerian entity is registered in Delaware or elsewhere and you are investing in the foreign entity, make sure there’s a legal relationship between the Nigerian entity and the entity you are investing in. It is not enough they have the same name. Does the FE own the LE?

4. At the very least understand the basics of the technology. Have the founders explain to you how it works in simple terms. As lawyers this is important to us because it is in understanding how the tech works that we can figure out what the risks are.

5. What are the current liabilities of the business? These things do not appear in pitch decks. If a business has taken a significant loan, as an investor you want to know about it. Ask about this - preferably in writing.

6. Finally, what are your information rights. I don’t think founders should be stressed to provide updates every week but you need to know how you’ll get access to information about the company and what type of information you’ll be entitled to.

In conclusion, get an experienced lawyer. Even if a doc is a template, the addition or deletion of a paragraph could change the entire character of the doc.
We talk about DD from a startup’s perspective here but also a useful read for Angel investors.
https://vazilegal.com/resource/how-startups-can-ace-the-due-diligence-process/