A virtual data room (VDR) is an online repository that allows sharing of sensitive files and documents. Startups seeking funding can submit confidential revenue forecasts, financial records, and IP ownership documentation to an investor data room. This lets investors to conduct due diligence quickly and take informed decisions.
Startups require a data room for investors in order to streamline due diligence and to arrange information. This tool helps simplify communication and speeds up the decision-making process during the course of a deal.
What documents should be saved in an investor data room?
In an investor data room startup documents are typically saved, regardless of the industry. These include term sheets, capitalization charts, and details regarding previous funding. The data room can contain technical documents such as integrations, system architecture, and product documentation that is already in place. Investors will also want to examine intellectual property documents like patents, trademarks, and filings.
Founders should consider setting up an investor data space early, even before raising funds. The startup can store all historical information in one location and then share it with investors during due diligence without the need to recreate the presentation. In addition the VDR should allow for accurate analytics, such as audit trails and activity monitoring so that the startup can track what documents are being watched and by whom.