A data room is an online platform that allows various parties to view and access the identical documents. It is usually used to conduct due diligence in mergers and acquisitions, fundraising and corporate restructuring. It is essential to research the cloud options that provide storage for data rooms like Quoroom or iDeals. Make sure the service you select has templates, methods to organize your files and make sorting them out more easily, bespoke analysis, and watermarking of downloaded files, as well as providing a cyber-secure environment.
When designing an investor dataroom the founders should consider the types of information that investors are looking for. It is recommended to include the following sections.
Documents related to company formation/organization These include articles of incorporation (bylaws) and business certificates, tax information, and any other documents an investor may require to verify the legitimacy of a company.
Financial Information: This includes historical and projected financials along with the assumptions, sources and reasoning that were used to create the projections. Founders may also wish to include whitepapers, pitch decks or a pitch deck in this section.
Founders can add the words “Other” section, which includes all other information an investor might require, such as intellectual property stacks, technology stacks, and more documentation about the company. Having a clearly organized and well-organized investor data room will make investors feel more secure that there aren’t any unintentional surprises or unanswered questions, which could lead to faster deals and higher valuations.