In the process of raising Series A funds or trying to conclude an merger, acquisition or investment deal, a data room for investors is a vital tool for due diligence. It allows you to consolidate all of your documents in one place and let third-party users access the data in real-time, without having to send email or ask for updated copies.
It’s tempting but you don’t want to burden your investors. The accumulation of too many documents can make due diligence long and exhausting for both parties. A well-organized, well-organized dataroom is necessary to ensure that investors are able to quickly and efficiently assess your company’s financial health as well as operational strategies and legal standing.
Investors will be interested in your company’s projected and historical financial statements. They will also be interested in knowing the source of any assumptions or models and the reasoning behind these. You may also include the recent and previous financing agreements and capitalization tables. Founders with a strong pitch that draws VC interest usually upload a copy in their data room.
Your investor data room needs to include clearly defined headlines on every slide. If the titles of a technical slide show are unclear or misleading it may be difficult for investors to follow. Avoid utilizing non-standard analyses in place More Bonuses of the standard ones (e.g. showing a portion of a profit and loss statement as opposed to a full one).