Most founders think Series A is a bigger version of their seed pitch. It is not. It is a fundamentally different exercise, one where the investor is no longer buying your vision. They are auditing your business.
By the time a serious African investor starts Series A due diligence, they have already seen your deck, liked your story, and believed in your market.
What happens next is a forensic examination of whether the business behind the story actually holds up.
Deals that look certain at the partner meeting collapse in due diligence every week on cap table issues nobody disclosed, on metrics that did not survive scrutiny, on team gaps that only became visible up close.
This checklist covers the 12 things that get examined. Use it six months before you raise it, not six days before. Because most of what is on this list cannot be fixed quickly.
1. Revenue That Passes Stress Testing
The entry point for Series A in Africa is roughly $500K–$1.5M ARR, still lower than global benchmarks because African price points are smaller but still a meaningful, recurring revenue base. What matters as much as the number is the shape of it.
Investors will pull apart your revenue into components: new revenue, expansion revenue from existing customers, and churned revenue.
A business where expansion MRR consistently exceeds churn, meaning existing customers grow their spend over time, signals something powerful: the product is delivering real value.
Companies with Net Revenue Retention above 100% can raise Series A at lower absolute ARR. Companies with high churn struggle regardless of the topline.
The question that kills deals is, “Walk me through why Customer X churned in Q3.”
If you do not know or give a vague answer, investors assume you are not close enough to your customers to build a sustainable business.
2. Growth Rate That Shows Momentum
Your ARR gets you in the room. Your growth rate wins or loses the deal. Series A investors in Africa are looking for 80–120% year-on-year growth, meaning you roughly doubled revenue in the past twelve months.
Companies growing faster command better valuations and more investor interest.
Companies growing slower need exceptional unit economics or a compelling structural reason.
Month-on-month consistency matters more than a single spectacular month.
A business growing 8–12% MoM steadily is far more fundable than one that grew 40% in January after a one-off enterprise deal and has been flat since.
3. Unit Economics That Actually Work
The three numbers every Series A investor will calculate independently:
LTV:CAC ratio
Lifetime value of a customer divided by the cost to acquire them. The floor is 3:1. Above 4:1 is strong. Below 3:1 signals a business that cannot scale profitably.
CAC payback period
How many months does it take to recover what you spent acquiring a customer? Above 18 months is a hard stop for most African investors at this stage, given the macroeconomic volatility of the region. Below 12 months is healthy.
Gross margin
For SaaS, above 60% is expected. For marketplaces and agritech, margins will vary, but investors want to see a clear path to margin expansion as you scale.
If you cannot produce these three numbers from memory, you are not ready.
4. A Clean, Explainable Cap Table
Series A investors will request your cap table on day one of diligence.
What they are looking for: founder ownership that still motivates (combined founder stake ideally above 40% post-Series A), no unknown shareholders, SAFE notes and convertible instruments that are all documented and reconcilable, and an employee option pool of 10–15% that has been properly issued.
What kills deals: SAFEs from seed rounds that were never properly documented, informal equity promises made to early employees, or a cap table so diluted that founders have lost the motivation to build for another five years.
In the Kenyan context
Companies incorporated in the UK or Delaware for investor-readiness purposes need clean transfer documentation if the IP and operations are in Kenya. Investors will ask. Have the answers.
5. A Data Room That Is Ready on Day One
The moment a serious investor signals interest, your data room should be ready to share. A disorganised or incomplete data room adds weeks to a process and signals operational immaturity.
Organise it into clear folders:
- Financials: monthly P&L, balance sheet, cash flow statement, revenue breakdown by customer
- Metrics: MRR/ARR dashboard, churn cohort analysis, CAC and LTV by channel
- Legal: company incorporation documents, cap table, all investment agreements, IP assignments, and key contracts
- Team: org chart, employment contracts for senior staff, option grants.
- Product: roadmap, customer case studies, NPS or satisfaction data
Use Google Drive or Notion. Keep it clean. Keep it current.
READ ALSO:What Seed Investors Actually Mean When They Say “We Need More Traction”
6. A Team With Functional Depth
At the seed stage, investors fund founders. At Series A, they fund organisations.
They will look for evidence that the company can operate beyond the founding team, meaning department heads or strong leads in product, engineering, sales, and operations.
You do not need a 30-person company. But you do need to demonstrate that key functions are not entirely dependent on one founder.
If the head of sales is also doing customer support and onboarding, that is a scaling problem, not a growth story.
The question that surfaces this: “What happens to sales velocity if you step back for three months?” If the honest answer is “it collapses,” the investor hears, “This is not yet a company.”
7. A Repeatable Go-To-Market Motion
“We get customers through relationships and word of mouth” is a seed-stage answer. Series A requires evidence of a repeatable, scalable acquisition channel – one where spending more produces predictably more customers.
This means being able to show: here is our primary channel (outbound sales, content, partnerships, and paid acquisition).
Here is our conversion rate at each stage of the funnel. Here is how CAC changes as we scale spend.
Here is what we will do with Series A capital to accelerate it.
If your go-to-market is still founder-led and relationship-driven, that is not a channel but a ceiling.
8. Proof of Product-Market Fit Beyond the Founder
Investors will speak directly to your customers during diligence. Not to catch you out, but to verify that the product love is real and unprompted.
They look for customers who describe the product in terms of outcomes, not features.
Who says they would be significantly impacted if it disappeared. Who came through referral rather than your direct sales effort.
Prepare your best customers for these conversations. Brief them on what investors may ask.
A single customer who can articulate specific, measurable business outcomes they have achieved is worth ten pitch slides.
9. A Financial Model That Is Honest
Investors will tear apart your financial model. What they are not looking for is precision; nobody expects you to predict the future accurately.
What they are looking for is coherent logic: do your assumptions connect?
Does your hiring plan match your revenue projections? Does your burn rate reflect what it actually costs to operate your business?
Red flags: Revenue assumptions that require CAC to drop 60% at scale with no explanation. Headcount that does not align with projected output. Burn that has been increasing without a corresponding increase in revenue.
The financial model is not a sales document. It is a test of how well you understand your own business.
10. Legal Hygiene That Survives Scrutiny
Most Kenyan startups discover their legal problems during due diligence, not before. Common issues that surface and delay or kill deals:
- IP not formally assigned from founders or early contractors to the company.
- Employees working without signed contracts
- Outstanding regulatory filings or tax obligations
- Data Protection Act compliance gaps increasingly scrutinised by international investors post-2023
- Informal shareholder agreements that were never formalised
A two-hour session with a startup-focused lawyer six months before you raise will surface and fix most of these. Do not wait.
11. A Clear 18-Month Plan for the Capital
“We will use the money to grow” is not a plan. Series A investors want to see a specific, milestone-oriented deployment plan: how much goes to hiring, to product, to marketing, to infrastructure — and what those investments are expected to produce in measurable terms by month 12 and month 18.
The milestones should point logically toward Series B readiness.
Investors are not just funding your next phase; they are assessing whether the next round is achievable because their return depends on it.
12. A Founder Who Knows What They Do Not Know
The final thing Series A investors are assessing and the one most founders do not prepare for is self-awareness.
Not humility as a performance, but genuine clarity about where the company’s weaknesses are, what the founder is working to fix, and what kind of investor support would actually move the needle.
The founders who close Series A rounds in Africa are not necessarily the ones with the cleanest metrics.
They are the ones who walk into the room knowing their numbers cold, knowing their weaknesses honestly, and making investors feel that their capital will be deployed by someone who will not be surprised by what the business actually is.
The One Thing This List Cannot Tell You
A checklist tells you what to prepare. It cannot tell you when you are ready.
Only about 5% of African seed-stage startups successfully raise Series A, not because the businesses are bad, but because most founders begin the process before the underlying fundamentals are in place.
The founders who beat those odds almost universally say the same thing: they wish they had started preparing earlier, and they are glad they did not rush.
Use this list now. Come back to it in three months. The gaps you find today are your roadmap.
Leave a Reply