Investor data rooms are secure virtual spaces that businesses utilize to share sensitive data with buyers and advisors during due diligence phases of M&A deals. These rooms are typically monitored and secured to ensure floridavdr.com that sensitive information does not fall into wrong hands. The best virtual data rooms provide due diligence checklists that can be used to simplify the process of collecting documents and ensure they are collected in a secure manner.
The documents you need to include in your data room will vary according to your specific situation and the transaction. However there are a few documents that are essential for every data room:
Legal Information: This includes articles of incorporation as well as intellectual property registrations and employee stock agreements. Also included is the cap table which breaks down ownership stakes as well as percentages of your company. Founders can include previous updates to investors which can demonstrate to investors that they value investor communication and transparency seriously.
Financial Information: This includes historical financial statements as well as projected financial statements and the assumptions, sources and logic behind these projections. Founders might also include their product roadmap and business plan.
Founders may choose to break the investor data room into sections and restrict access to certain users by granting different roles. For instance one section could have strategy documents and presentation decks for early stage investors while the other section will contain more in-depth legal documents aimed at serious investors. This allows them to save time by only sharing the documents they require and gives them more control over how sensitive information is shared.