A virtual data room is an essential element of fundraising for many startups. It allows companies to share important documents with investors for due diligence without the need to email them a lot of confidential documents. It’s essential that startups know what information they must include in investor data rooms to avoid the waste of time.
Investors will likely have a pitch deck to review, however, they will also need to be able to access your most recent financial data (historical and projections). Investors will want to examine your business model in depth which is why they’ll examine cash flow statements as well as investment case studies, discounted page cash flow models, and discounted cash flow analyses. They’ll likely also want to examine your monetization strategy and valuation calculations.
In addition, to the basic financials, they’ll want to be able to see your IP information, including trademarks, patent filings, and other IP assets that are relevant to your business. They will also want to look up any letters of recommendation from employees or customers. In addition, they will want to see any legal agreements that you have with your existing customers or investors.
After they have reviewed this information, you will need to be able identify who has accessed each of these documents. This is a key characteristic of all investor data rooms because it permits you to take appropriate action if any issues arise from the use or disclosure by an individual of information about your company. A reliable investment banking VDR will provide you with an overview of the activities and offer options to restrict or revoke access to particular documents if necessary.
