Investor due diligence is an essential part of any investment process. The more prepared you are, the faster your investors can finish their due diligence. An investor data room makes the process much simpler for everyone involved.
LPs will require many different documents like legal contracts, customer and supplier agreements as well as intellectual property information market research, cap table, financials, and more. By using a virtual dataroom, it’s easy to share files with third-party companies. This also reduces the risk of sending duplicate copies of documents or those that are out of date. Providing these documents in a logical and easily accessible investor data rooms also helps to demonstrate your organization and professionalism.
The investor data room is the perfect place to save and share your presentation deck (or investor pitch) for a prospective investor. Although the investor presentation itself isn’t part of the due diligence supplementary information, many founders use it as a way to provide context and ease investors’ access to the details they require.
Some founders also make use of their investor data room to https://dataroomsource.com/virtual-data-rooms-and-how-progressive-they-are/ store different sets of information for different kinds of investors. Some founders, for example have an investor data room that is a “draft” or investor data room that they share with investors that have not yet committed, and another set of documents available to those who are about to sign a deal. This allows them to control the amount of information they share at any given moment and ensures that the right information is delivered to the right people.