Investor data rooms are secure virtual spaces that businesses use to share sensitive information with buyers and advisors during the due diligence phase of M&A deals. These rooms are usually secured and monitored continuously to ensure that the data they contain does not fall into the in the wrong hands. Top providers of virtual data rooms offer checklists of due diligence ready-to-use to streamline the collection process and ensure that all relevant documents are gathered carefully.

Documents you should include in your investor data room can vary depending on the situation and the transaction, however some essential documents are critical for every data room:

Legal Information It includes articles of incorporation as well as intellectual property registrations and employee stock agreements. It also includes the cap table, which breaks down ownership stakes and percentages of your company. Founders can choose to include past https://floridavdr.com/top-virtual-data-room-providers-in-india/ investor updates as well which can show investors that they take the issue of transparency and communication with investors seriously.

Financial Information: This includes historical financial statements and projected financial statements and the assumptions, sources, and reasoning behind these projections. Founders may include their business plan and roadmap here as well.

Founders may decide to split the investor data room and limit access by assigning different users roles. For example one section could have strategy documents and presentation decks for investors in the early stages while the second section will contain more in-depth legal documents targeted at more serious investors. This lets them reduce time by sharing only the documents they need and allows them to control how sensitive information is shared.