Investors need all the information they can get about your company prior to investing their time and money. A Data Room for Investors can help them make a more informed decision and speed up the process of due diligence for investment. This could mean the difference between receiving the funds you require and not.
A Data room is an increasingly popular method for startups seeking funding. A Data room for investors is better than sending the entire investor package by email or Google Drive (which hackers can easily access), and it lets you monitor any issues with access. There are numerous alternatives to software that can be used for Investors’ Data Rooms, but one of the best options is Caplinked which has various options to safeguard sensitive information and streamline the process.
What’s in a room for investors
While the majority of the documents on this list will be familiar to potential investors from your pitch deck or one-pager but a more comprehensive list could provide more clarity and pre-empt questions that may come up during due diligence. One of these documents is a detailed overview of the founders and their experience, which can show that your company has a deep network that they can draw upon should they need it.
A legal document that details the company’s formation, structure, and tax information is also important. It is also possible to include a cap table that clearly defines who owns how much of the company. It is a good idea to create a mockup of or prototype of the product. This is especially relevant in the beginning in which it can be difficult to explain how the product works or its potential value.