A data room is a must-have instrument to conduct due diligence, regardless of whether you are raising Series A financing or closing an acquisition, merger or investment deal. It lets you consolidate all documents into one place and allow third parties to access the information at any time without having to email or request updated copies.
It’s tempting to make the move, but you shouldn’t to burden your investors. Having too many documents can make due diligence lengthy and frustrating for both sides. A well-organized and organized dataroom is vital to ensure that investors are able to quickly and efficiently assess your business’s financial health as well as operational strategy and legal status.
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 modeling and the reasons behind them. You may also include a list or past capitalization tables, financing agreements and other information. founders who have a convincing enough pitch to attract VC interest http://dataroomnote.com/what-factors-make-one-data-room-better-than-the-other/ often put a copy or a draft of their pitch deck to their data rooms as well.
The most important thing is that your investor data room must include clearly defined headlines for each slide. It is often difficult for an investor to navigate through a lengthy technical slide show if the titles are unclear or confusing. Avoid using non-standard analyses in lieu of conventional ones (e.g. showing a portion of a Profit and Loss statement, versus a full-length one).
