An investment data room is a platform that allows investors to look through the pros and cons of vertical consolidation for business documents for the company. This tool can accelerate due diligence and help a founder to show professionalism and transparency towards potential investors.
A professional-grade virtual deal room can also aid in tracking and reporting on the activity of investors. Most likely, your investor won’t tell you every time they visit or look at an item you’ve shared but a VDR will give you a quick overview of use statistics that let you know the frequency and locations where your information is being accessed.
The legal documents, financial forecasts, and business model presentations are among the most important documents that startups should include in their investor data room. This information can give investors an idea of the company’s performance and give an accurate picture of the business.
Other documents startups can include in an investor data space include a pitch deck as well as whitepaper. These documents are used to describe the problem your product solves, how you’ve researched the market and how your product or service is efficient at solving that problem.
Founders should also consider creating different investor data rooms based on the stage of their interaction with potential investors. This way, you’ll limit the amount of information you divulge at any given time and only share the most relevant documents. This is beneficial in establishing trust with investors since you will only disclose information you believe is crucial.