Whether you’re in the process of raising Series A funds or trying to conclude a merger, acquisition or investment deal, a data room for investors is an essential tool to conduct due diligence. It allows you to organize all documents into one place and allow third parties to access the information in real-time without having to email or request updated copies.
It’s tempting to make the move, but you shouldn’t to overwhelm your investors. The accumulation of too many documents can make the due diligence process lengthy and frustrating for both parties. A well-organized data room is key to ensure that investors can quickly and efficiently review the company’s performance, operational strategy, financial health and legal standings.
Investors will be interested in your company’s projected and historical financial statements. They’ll also want to know the origin of any assumptions or models and the reasons behind these. It is also possible to include a list of your previous capitalization tables, financing agreements and other data. Founders who dataroomnote.com/data-room-cost-and-its-relevance-with-service/ have a strong enough pitch to draw VC interest will often upload a copy of the pitch deck in their data room as well.
Your investor data room must include clearly defined headlines for each slide. If the titles of a technical slide presentation are unclear or inaccurate they can be difficult for investors to follow. Avoid using non-standard analysis instead of standard ones (e.g. showing only a portion of the Profit and Loss statement in contrast to. an entire view).