What will investors ask for before putting money into your Philippine company?

Short answer: Before investing, serious investors will ask whether your Philippine company is legally clean, financially understandable and capable of using capital well. Expect requests for ownership records, reliable historical numbers, a defensible forecast, tax and regulatory evidence, material contracts, management access, a clear use of funds and proposed investor rights.

The first investor meeting may feel like a test of the pitch. The real test begins when the investor asks for evidence. A credible investor must be able to explain to an investment committee who owns the company, how it makes and converts money, what could go wrong, how the new capital creates value and which rights are needed to protect the investment.

This guide is for founders, owners and finance leaders preparing a Philippine company for equity investment. Alehar's Philippines corporate finance advisory page gives the wider country context. Here, the focus is practical: the questions behind a diligence request, the documents that answer them and the gaps worth fixing before investor outreach begins.

What investors are really trying to prove

Request lists vary by investor and company stage, but most questions test one of six propositions.

The investor is not looking only for documents. It is comparing the deck, management answers, accounting records, contracts and legal ownership record. A clean file that contradicts another clean file is still a diligence problem.

The request changes with the investor and the stage

An angel investor writing an early check will not run the same process as a growth-equity fund, family office, private equity investor or strategic corporate. Prepare a strong common evidence base, then add the detail that fits the likely buyer of the shares.

• Angel and seed investors usually focus on founder quality, product evidence, early traction, market size, incorporation, ownership, prior notes or options and the milestones the next round should fund.
• Venture and growth investors tend to go deeper on cohort or customer economics, growth efficiency, product and technology, hiring capacity, the financial model, the cap table and the next financing path.
• Private equity and family-office investors often place more weight on maintainable earnings, cash conversion, management depth, controls, customer concentration, related parties, debt, governance and exit options.
• Strategic investors may test commercial fit, channel or supply dependence, intellectual property, regulatory exposure, integration constraints, conflicts and whether the proposed relationship changes other customer or partner contracts.

The amount of capital matters, but so does the investor's mandate. Ask early what the investor needs to take a proposal to its investment committee, which advisers will join diligence, who makes the final decision and what must be true before funds can be released.

1. Who owns the company, and can it issue the promised shares?

Start with a fully diluted cap table that reconciles to the legal record. List every issued share, subscription, option, warrant, convertible instrument and promised allocation. Identify unpaid subscriptions, nominee arrangements, transfer restrictions, preemptive rights, liens and disputes. If the company has subsidiaries or related entities, show the full group structure and explain where employees, contracts, assets, debt and intellectual property sit.

This is a Philippine corporate-law question, not just a spreadsheet exercise. The Revised Corporation Code requires stock corporations to maintain a stock and transfer book, makes transfers effective against the corporation only when recorded in its books and gives existing stockholders preemptive rights unless the articles validly deny them or an exception applies. The Code also requires SEC approval for an increase in capital stock.

Investors will therefore ask for:

• the certificate of incorporation, current articles of incorporation and bylaws;
• the latest General Information Sheet and beneficial-ownership records;
• the stock and transfer book and copies of share certificates;
• subscription agreements and proof that subscriptions were paid;
• shareholder, voting, nominee, option, warrant and convertible agreements;
• board and shareholder minutes approving previous issuances and material transfers;
• a reconciliation from the legal register to the fully diluted cap table; and
• an analysis of authorized but unissued shares and approvals needed for the proposed round.

Resolve inconsistencies before valuation negotiations. If the cap table says one thing and the stock and transfer book says another, the investor cannot know what percentage it is buying or who may challenge the issuance later.

2. Do the financial statements explain the real business?

Audited financial statements are the starting point for an established company, not the end of financial diligence. Investors will want monthly information that shows how revenue, margin, working capital and cash move inside the year. They will also test whether management uses the same numbers to run the business.

Prepare a controlled financial pack containing:

• audited financial statements and tax returns for the relevant historical periods;
• monthly profit and loss, balance sheet and cash flow information that reconciles to the general ledger;
• revenue and gross-margin analysis by customer, product, site, channel or business unit;
• accounts-receivable aging, inventory, payables and other working-capital schedules;
• bank accounts, debt, leases, guarantees, security, covenants and contingent liabilities;
• related-party balances, transactions and shared costs;
• capital expenditure and fixed-asset records; and
• a bridge from reported earnings to any normalized or adjusted measure used in the pitch.

Investors will investigate differences between management reporting, audited accounts, tax filings and bank activity. Differences are not automatically fatal. Unexplained differences are. Keep a written reconciliation and assign one owner who can trace each material number back to its source.

3. Does the forecast show how new capital creates value?

A forecast is credible when its operating assumptions can be challenged separately. Revenue should connect to price, volume, customers, capacity or pipeline. Headcount should connect to roles and hiring dates. Capital expenditure should connect to output and timing. Working capital should respond to growth rather than remain a fixed percentage without explanation.

Investors are likely to ask:

• What exactly will the money fund?
• Which milestones should the capital unlock, and by when?
• Which assumptions have already been proven?
• What happens to cash if revenue is later, margins are lower or hiring takes longer?
• Which actions will management take in the downside case?
• Will the company need another round, and what must be true before then?

Show the use of funds by initiative and month, with a deliberate minimum-cash buffer. A large annual total does not tell an investor when the company could run short or which spend can be delayed. The board should be able to use the same model after closing to compare actual deployment with the investment case.

4. Is the revenue durable enough to support the story?

Investors will look behind the headline growth rate. They may ask for customer concentration, contract terms, renewals, churn, pricing history, sales pipeline, backlog, cancellations, returns, credit notes and collections. A company with strong reported sales can still have a weak investment case if one relationship drives most of the revenue, contracts are easily terminated or cash arrives much later than invoices suggest.

Prepare contract summaries that point to the signed source documents. Flag change-of-control provisions, exclusivity, minimum purchases, price resets, assignment restrictions, rebates, warranties and unusual termination rights. If important customer or supplier relationships are informal, record the history and the risk honestly rather than presenting an unsigned understanding as a contract.

Management should also explain why customers buy, how the company wins and loses business, what limits growth and which competitors matter. Investors test commercial evidence against the forecast. A pipeline that does not reconcile to historical conversion, sales capacity or delivery capacity will be discounted.

5. Are the corporate, tax and regulatory records current?

Investors will ask whether the company has remained in good standing and can continue its operations after the investment. The SEC's current reportorial-requirements page identifies the 2026 General Information Sheet and separates the Beneficial Ownership Declaration into the HARBOR filing process. It also lists annual financial-statement requirements for relevant corporations. Investors may ask for filed copies and proof of receipt rather than drafts held internally.

The diligence list may also include:

• BIR registration, returns, payment evidence, audits, assessments and correspondence;
• local business permits and industry-specific licenses;
• employment records, statutory contributions and material labor matters;
• data privacy, cybersecurity, consumer, environmental or product compliance where relevant;
• litigation, investigations, notices, claims and settlement obligations;
• insurance coverage and claims history; and
• board approval and conflict records for related-party transactions.

Do not upload personal data or sensitive regulatory material to every prospective investor. Build an indexed schedule first, remove information that is not needed, use confidentiality controls and stage access according to seriousness and risk.

6. Can a foreign investor own the proposed stake?

If the investor is not a Philippine national, check the company's real activities, licenses, subsidiaries and assets before promising an ownership percentage. Executive Order No. 113, the 13th Regular Foreign Investment Negative List, identifies activities reserved in whole or in part to Philippine nationals. Sector-specific laws and land ownership can add constraints, so the analysis must follow what the business actually does rather than the label used in the pitch deck.

For inward foreign investment, funding evidence and registration mechanics also need an owner. The BSP's December 2025 foreign-investment FAQ lists proof of funding and proof that the investment was made and recorded in the investee's books among the supporting documents for registration. Confirm the current banking, foreign-exchange, SEC and closing requirements with Philippine counsel and the relevant bank before funds move.

A private fundraising process also needs a securities-law path. The Securities Regulation Code requires securities to be registered unless an exemption applies and sets out exempt transactions. Counsel should confirm the exemption, eligible offerees, filings, fees and communication process before outreach, not after a term sheet is signed.

7. Does the company own the assets and relationships it depends on?

Investors will test whether value sits inside the company receiving the investment. Common gaps include software created by a founder or contractor without an assignment, a brand registered to another entity, land or premises owned by a shareholder without a stable lease, employees contracted through a related company, customer agreements signed by the wrong entity and licenses that cannot be transferred or maintained after ownership changes.

Prepare an entity-by-entity map of:

• intellectual property, domains, software, data and brand registrations;
• employees, contractors, incentive arrangements and key-person dependencies;
• property, equipment, leases and security interests;
• customer, supplier, distribution, franchise and partnership contracts;
• intercompany services, loans, guarantees and shared resources; and
• permits and licenses required for the activity.

Related-party arrangements should have a commercial explanation and written terms. Investors are not automatically opposed to them, but they need to know whether pricing is defensible, whether the arrangement continues after closing and whether value can move outside the company without their consent.

8. What rights will the investor ask for after closing?

Before investing, a serious investor will ask how it receives information, participates in governance, protects against material changes and eventually realizes a return. The discussion may cover board or observer rights, budgets, new debt, major capital expenditure, related-party transactions, future share issues, transfers, information rights and exit provisions.

Do not negotiate these rights from a generic list. Write them against the way the company actually operates. Approval thresholds should distinguish a major decision from ordinary business, reporting promises should match what finance can produce accurately and deadlock provisions should not allow a minority holder to freeze routine execution.

Alehar's guide to selling a minority stake to fund growth in the Philippines explains dilution, preferences, vetoes, information rights and exit terms in more detail. Use that analysis after the evidence pack shows that the company is ready for a real terms discussion.

Stage the data room instead of opening everything at once

A well-prepared company can respond quickly without giving every interested party unrestricted access. Match disclosure to the investor's seriousness and the sensitivity of the material.

1. Initial review: current deck, concise historical financials, key metrics, use of funds, high-level cap table and management discussion.
2. Qualified interest: more detailed monthly financials, operating data, forecast, customer analysis, corporate structure and selected contracts under confidentiality.
3. Term-sheet diligence: indexed corporate, legal, tax, financial, commercial, people, IP and compliance material, with a controlled question log.
4. Pre-closing: final approvals, disclosure schedules, bring-down information, funding evidence, regulatory steps and signed closing documents.

Use named folders, a document index, consistent period labels and one owner for uploads. Record who received access, when it was granted and which version was shared. For startup-specific folder design, Alehar's Series A data room checklist provides a more detailed structure.

Red flags that weaken confidence before price is agreed

• The cap table cannot be reconciled to the stock and transfer book.
• Prior share issuances or transfers lack signed documents or required approvals.
• Audited statements, tax returns and management accounts tell materially different stories without a bridge.
• Revenue growth depends on one customer, unsigned renewals or a pipeline presented as contracted sales.
• The forecast is a percentage-growth exercise with no operating drivers, working capital or downside response.
• Founder, family and company expenses or assets are mixed.
• Important IP, licenses, employees or contracts sit outside the company.
• Foreign-ownership restrictions are addressed with a generic assurance rather than an activity-by-activity review.
• The company sends inconsistent files to different investors and cannot identify the current version.
• Management promises reporting or governance rights before checking whether the company can deliver them.

A red flag does not always end a transaction. It can reduce valuation, change the structure, create a closing condition, produce a specific indemnity or delay funding. Finding it before outreach gives the company more options than explaining it under exclusivity.

A practical readiness check before investor outreach

1. Reconcile ownership. Tie the fully diluted cap table to the legal registers and every instrument that can change ownership.
2. Close the numbers. Produce current monthly accounts, reconcile them to statutory records and explain material adjustments.
3. Build the investment case. Connect the use of funds to milestones, operating drivers, cash and a downside plan.
4. Map the legal perimeter. List entities, licenses, contracts, IP, people, disputes, related parties and foreign-ownership constraints.
5. Choose disclosure stages. Decide what each investor receives before confidentiality, after qualification, during diligence and before closing.
6. Assign owners. Give every diligence section a responsible executive and route all investor questions through one controlled log.
7. Pressure-test the story. Ask people outside the preparation team to challenge the cap table, financial bridge, forecast, concentration and legal structure.
8. Set commercial boundaries. Agree the capital need, valuation support, acceptable investor profile, governance red lines and walk-away conditions.

If your company is family-owned, Alehar's guide to preparing for a first institutional investor goes deeper on owner alignment, management depth and the shift from family understandings to documented governance.

Prepare the company before the investor sets the timetable

The strongest answer to an investor request is not a polished folder. It is a company whose ownership, reporting, commercial evidence, compliance and growth plan already agree. That gives management faster answers, fewer surprises and more room to compare investors on fit and terms rather than accept whichever process survives the data room.

Alehar's Raising Equity or Debt team can help define the capital need, prepare the model and materials, organize diligence and run a controlled investor process alongside the company's legal, tax and accounting advisers. Contact Alehar before outreach to discuss what investors are likely to test and which gaps should be fixed first.