Guest post by Udit Akhouri (Co-founder, Exthalpy)
This wasn’t the first company built, but it was the first to take venture capital—and the diligence cycle felt epic for a seed round. What looked like a delay over three-plus months turned into a proving ground that sharpened thinking, systems, and resolve. The extra time didn’t stall progress; it created space to upgrade foundations and double down on conviction.
Origin story
Udit here – 21, IIT Patna—shipping products for five years, mostly bootstrapped: from Sttabot AI to Bully AI, scrappy cycles taught speed and humility. Exthalpy felt different: a 10-year canvas, not a sprint. Incorporated December 2024; pitched Malpani Ventures on May 14, 2025; closed a ₹2.5 crore seed from them, with MeitY adding ₹40 lakh in the same round; roughly five months end-to-end. These are the hard-won lessons from that window, so you don’t repeat the avoidable.
- Don’t outsource critical controls to kin
A relative served as CA, and compliance discipline slipped: filings missed, minutes not recorded, basic formalities overlooked. Diligence surfaced it before it became terminal. Separation of duties > familial convenience when money and governance are at stake. Lesson: keep finance independent and professional.
- Term sheets aren’t your product roadmap
Early on, too much energy went into debating SHA and minor clauses when the product needed compounding. Reputable early-stage funds tend to be within fair bounds; spend cycles where outcomes move. Lesson: close on principle, not perfection; earn leverage by building value.
- A real CA is operational leverage
The absence of a strong CA created invisible drag—months of retro-fixes across payroll, vendor flows, and compliance cadence. Great CAs install rhythms that free founders to build and prevent scary surprises in diligence. Lesson: hire a CA like you hire a CTO—on scope, rigor, and speed.
- Founder bandwidth is not infinite
Juggling product, diligence, infra, and hiring led to context thrash. Compliance work resists multitasking; it demands calm, sequence, and care. Lesson: delegate early and create single owners; quality rises when attention isn’t split.
- HR hygiene shapes culture
Diligence forced formal HR scaffolding—employment agreements, holiday policy, incentives, PF—and it changed how the team perceived the company. Paperwork isn’t paper; it’s trust, clarity, and professionalism made tangible. Lesson: treat teammates like professionals and the organization like a promise.
- Guard names before they grow
The brand gathered momentum faster than filings, and that gap nearly cost the mark. Trademarks are cheap insurance for identity. Lesson: file early; it’s easier to protect a name than to reclaim it.
- Provisional patents are momentum tools
Patents once seemed like big-company theatre, but provisional filings proved fast and affordable, buying time to deepen IP. If you’re pushing technical depth, protect the edges as you iterate. Lesson: use provisional filings to stage your IP roadmap.
- Books signal seriousness
Messy records—sheets, scattered emails, version confusion—spooked investors and slowed everything. Clean, audit-ready books communicate craft, not just compliance. Lesson: close monthly, reconcile rigorously, and document decisions.
- Liquidity is oxygen
The round took longer than assumed; reserves kept the lights on. Without a buffer, the company’s runway would have ended before funds arrived. Lesson: maintain a contingency for both personal and company burn.
What diligence really measures
Diligence isn’t box-ticking; it’s a mirror for readiness across product, process, people, and prudence. Before you raise the first round, slow down, install the rails, and then go fast. The compounding comes from clean execution as much as clever ideas.