How to Prepare an Online Data Room for Investors

A data room is a platform that allows startups to upload important documents to ensure due diligence prior to a financing round or an M&A deal. This usually includes the company’s financial projections, as well as comprehensive IP ownership documents. The information is made available to potential investors, who can make informed decisions when investing in a start-up.

When preparing an investor data room, investors can decide to include the following details:

Pitch Decks or Whitepaper Founders are able to upload their pitch decks as well as whitepapers that outline how their product/service addresses complex problems or markets in a clear manner and is profitable. This document will help establish trust with investors and demonstrate accountability.

Projections: Founders may include both historical and projected financial statements, as well as the assumptions, sources and logic behind the projections. This can simplify the due diligence process, and help investors comprehend the projected financial performance of a business and growth potential.

People-Related Documents: Founders may include resumes of the team’s key players and any employee stock agreement or documents related to hiring. Founders may include their growth strategy and their go-to-market strategy.

Investor Updates: Throughout the fundraising and due diligence process, founders can add a series of investor updates to the VDR. This keeps investors updated on the developments of the business and shows them that the company is committed to making the most of their money.

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