A data room for investors is a central repository where documents can be shared with potential investors or financial backers. It allows for a rapid, efficient, and organized access to the information without having to send multiple versions of the document via email. The data room is secured with features such as expiring links, password protection, watermarks, and granular permissions.
There are many documents that should be shared with potential financial backers, from the basic documents like your term sheet or capitalization table and rounds of investment to more detailed due diligence data including the most recent financial statements (both historical and projected) as well as human resources documentation like founders‘ resumes, employment contracts and employee stock options. Include documents that are technology-related, such as system architecture, integrations, and existing product documentation.
The more information you add the more details you https://dataroomtools.com/benefits-of-an-investor-data-room/ include, the longer it will take investors to read it. Additionally, the more information you include, the higher the chance of exposing or stealing sensitive information. To be able to move quickly, it is important to keep a balance between the need for clarity and the amount of information you give.