The Questions You'll Get

The first call goes well. It usually does. It's a getting-to-know-you conversation: how you started the company, where the science came from, what the market looks like. The investor is warm, curious, complimentary about the technology. You come off the call thinking that went great.

Then the tone changes.

Once a sponsor has established that you're genuinely interested in transacting, the register shifts. The questions get specific, they get repeated, and they stop being curious. This isn't bad faith; it's the process working as designed. The friendly call establishes whether there's a deal to be had. Everything after it is about what the deal is worth and where the risk sits. And the person asking has done this a hundred times against your one.

Two things follow from that. First, the pressure phase is a signal of interest, not a problem to be survived. Second, and less obvious: anything you said casually in the warm conversation becomes the baseline you're held to in the hard one. A number you rounded up over coffee gets quoted back to you six weeks later with a decimal point on it.

So the rule is simple. Answer the friendly call as if it were the third call. Here's what the third call sounds like, and what sits behind each question.

Here are a few questions, from our experience:

"What data shows improvement in reproducibility, recovery, CVs, or depth versus standard prep?"

What it's testing: whether your advantage is measured or asserted.

Nearly every reagents company says it improves reproducibility. Very few can produce the CV data with sample sizes, operator counts, and the comparison protocol named. The investor is checking whether your performance claim survives contact with a spreadsheet.

Bring: the head-to-head dataset, n disclosed, operators disclosed, comparator kit named by catalog number. If the data came from a friendly lab, say so before they ask.

"How sensitive is performance to operator skill, sample type, or upstream variability?"

What it's testing: whether your product works in an average lab or only in a good one.

A kit that requires a skilled hand is a kit with a support burden, a churn problem, and a ceiling on the addressable market. This question is a proxy for gross margin three years out.

Bring: the variance data across operators, not just your best one. If sensitivity exists, name it and name the mitigation. Investors discount hidden fragility far more than disclosed fragility.

"How well does this scale across sample numbers, sample types, and automation?"

What it's testing: whether you are a research tool or a production input.

Tens to thousands is where pricing power lives. If the workflow breaks above a few hundred samples, or can't be lifted onto a liquid handler, the biopharma and CRO segments are closed to you and the sponsor is underwriting an academic business.

Bring: the automation validation, or a clear-eyed account of what it would cost and take.

"What new steps, consumables, or failure modes does this introduce? Where do users struggle on first adoption?"

What it's testing: switching cost and time-to-value.

The honest answer here is worth more than the flattering one. Every investor knows first adoption is where kits die. A founder with a documented onboarding failure log looks like someone running a business. A founder who says adoption is seamless looks like someone who hasn't measured it.

"Walk me through manufacturing. Who makes it, what are the lot-release specs, and what were your last three out-of-spec events?"

What it's testing: whether you have a product or a protocol.

For a reagents business this is the thesis, not a footnote. Batch-to-batch variation is the standard failure mode in the category. It's the criticism levelled at antibody reagents across the entire sector, and every sponsor who has looked at tools before knows it. Expect follow-ons on single-source raw material dependencies, in-house versus CMO, who signed off on the specs, the COGS curve at ten times volume, and ISO 13485 status.

Bring: the spec sheet, the deviation log, and the root cause on each OOS event. A kit that works and can't be made twice is a science project.

"What exactly is protected: chemistry, formulation, method, consumable design, or workflow claims? How hard is it to design around?"

What it's testing: whether your IP is a moat or a decoration.

This is the good version of the IP question. "Do you have patents" tells an investor nothing. Composition-of-matter on a novel chemistry is a different asset from a method claim on a workflow that a competent competitor can route around in eighteen months. If the real protection is a trade secret in the formulation, say that. It's a legitimate position, but it changes the diligence path and it changes what a buyer is buying.

Bring: the claim set, the family map by geography, and an honest design-around assessment. If you've never had one done, that's an answer too.

"Has a formal FTO analysis been conducted? By whom, and in which geographies?"

What it's testing: whether there's a landmine that surfaces at scale.

Third-party patents matter differently at $3M of revenue than at $30M. A blocking patent nobody enforces against a small player becomes a live licensing negotiation the moment volume makes you worth suing. Sponsors have seen this movie.

Bring: the opinion, dated, with counsel named and US/EU/China coverage stated. If you don't have one, know that it will be a condition of closing and price it into your timeline.

"Whose instrument does this run on? Do they sell a competing kit, and what happens if they bundle one?"

What it's testing: whether you control your own distribution or rent it.

Sample prep sells into someone else's box. That dependency is simultaneously your best exit route and your existential risk, and the pattern is well established: Thermo licensed MSAID's software into Proteome Discoverer before acquiring the company; Bruker bought Biognosys out of the analysis layer sitting above its own instruments. Being embedded in a major vendor's workflow is exactly what makes you acquirable, and exactly what makes you replaceable.

Bring: the platform split of your revenue, any co-marketing or distribution agreement in force, and a straight answer on what the vendor already sells into the same step.

"What does the revenue look like underneath the top line?"

What it's testing: durability, not size.

Reorder rate by account. Cohort retention. Top five customers as a percentage of revenue. The academic/biopharma/CRO split. ASP trend. And the number that predicts most of the rest: attach rate per installed instrument in the customer's lab. Academic exposure is a live headwind right now. A target at 60% academic revenue is a fundamentally different asset from one at 15%, and the sponsor will establish which you are with or without your help.

Bring: the cohort table. If reorder rate is soft, have the reason ready.

"What has limited growth so far: market size, product readiness, sales execution, pricing, or customer inertia?"

What it's testing: whether your projections have a mechanism.

This is the sharpest question you'll get, and the most commonly fumbled. The hockey stick in your model requires something to change. If you can't name what has been broken and what specifically will fix it, the investor concludes the constraint is demand, and demand constraints don't respond to capital.

Bring: the funnel, stage by stage. Awareness, trial, conversion, repeat. Show which stage leaks. "We converted 40% of trials but only ran nine trials last year, because nobody was doing outbound" is a fundable answer. "The market is growing 14% annually" is not.

"What do customers say the alternatives do better?"

What it's testing: whether you've listened to the people who said no.

The next-best alternative is usually not a competitor kit. It's the in-house protocol, or doing nothing. Those alternatives win on familiarity, flexibility, and perceived safety, and a founder who can articulate that credibly is a founder who knows where the sales cycle actually stalls.

"Has any customer asked for IVD-grade supply?"

What it's testing: whether a quality-system obligation is heading toward you unfunded.

If your customers are drifting toward clinical use, RUO labelling stops being a label and becomes a commitment. This question rarely appears on a first-call form and reliably appears before term sheet.

Bring: the request, if there was one, and what you told them.

When the Same Question Comes Back a Third Time

Late in a process, some questions stop being diligence and become negotiation. The tell is repetition. A sponsor who genuinely doesn't understand your reorder rate asks once and reads the cohort table. A sponsor building a case for a lower number asks about it in three separate conversations, each time with slightly more concern in their voice, until you volunteer that yes, it's a bit soft.

That's price discovery, and the right response is different. Diligence questions get answered with artifacts. Negotiation questions get answered the same way, once, in writing, and then you stop re-litigating. Volunteering additional worry in response to manufactured concern is how founders talk themselves down a turn of EBITDA.

The distinction matters more than founders expect: it's the difference between being thorough and being worked.

The Structural Fix

Look back at the list and notice how many of these invite an opinion. "Where does your solution clearly outperform?" is a pitch prompt, and experienced investors discount pitch answers automatically.

Replace every opinion with an artifact. The CV dataset with n and operator count. The named account that churned and why. The failure log. The FTO opinion with a date on it. The lot-release spec. Founders who do this consistently move through diligence in half the time, because each answer closes a thread instead of opening one.

And the One Worth Knowing Before You Start

What does the exit look like. Content and consumables businesses in life science tools clear better than the folk wisdom suggests. Danaher's acquisition of Abcam priced at roughly 12.5x revenue, Bio-Techne has sustained high single-digit to low double-digit revenue multiples in the public market, and IonOpticks, a chromatography column business with no instrument franchise at all, attracted a control buyer on consumables economics alone.

If you're being told consumables clear cheap, check who's telling you and what they're buying.

MaTrx advises founders and owners on sell-side M&A, capital raises, and strategic exits. If you're preparing for an investor process, or fielding inbound you didn't ask for, we are happy to connect.