A digital investor dataroom makes it easier to share sensitive information with investors. It accelerates the capital-raising process and helps build confidence. With features such as granular permissions security, password protection, and watermarking, it helps avoid accidental or deliberate document leaks. It is also useful for archiving and preserving documents and allowing users to access files even after the transaction is over.
During due diligence, investors look for key legal information like the company’s overall business plan and financial projections. Incorporating these documents into the virtual data room helps investors evaluate the startup’s potential and gives them complete information about their investment. Other important documents to include are regulatory compliance documentation audit reports, as well as penetration testing reports. Investors can evaluate the startup’s compliance with data protection regulations and cyber standards. This will allow them to mitigate security risks and ensure that they are investing responsibly.
It is also beneficial to present investors with key performance metrics and growth reports. Having these information in the data room demonstrates that the startup is accountable and is able to be trusted by investors. It’s also recommended to include a section on the sustainability plan for the startup and give investors an overview of the future and how they will make their operations sustainable.
Some founders also choose to separate the different types of information within their investor data rooms based on stages. This lets them provide relevant documents to each investor at the appropriate time, saving both time and ensuring that crucial information is not missed.