A virtual dataroom (VDR) allows you to share sensitive files and documents online. Startups looking for funding can submit confidential revenue forecasts, detailed financial records and IP ownership documents to an investor data room. This lets investors to conduct due diligence quickly and take informed decisions.

If they’re seeking venture capital investors for their next round of funding, or preparing to close an M&A transaction, startups require an investor data room to organize the information and ease the due diligence process. This solution can help reduce communication time and speed up the decision-making process during a transaction.

What documents should be saved in an investor data room?

Regardless of business, startup documents typically saved in an investor data room include term sheets, capitalization tables as well as previous information on funding. The data room may contain technical documents, like systems architectures, integrations or even existing product documentation. Additionally, startup’s investors should review intellectual property documentation, which includes patent numbers and filings, trademarks and any other private assets.

Founders should think about setting up an investor data room as early as possible even before they raise a funding round. In this way, the startup will have all the information from its past stored in a single location and will be able to provide it to investors during due diligence without the need to recreate the presentation from scratch. The VDR should also include insightful data, such as activity tracking and audit trails to ensure that the startup can monitor which documents are viewed by whom.

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