Investor data rooms are secure virtual spaces that businesses use to share sensitive information with buyers and advisors during due diligence phases of M&A deals. These rooms are usually monitored and secured to ensure that sensitive information doesn’t end up in the wrong hands. The best virtual data rooms provide due diligence checklists that can be used to streamline the collection of documents and ensure that they are collected with care.

Documents you need to include in your data room will vary depending on your situation and the transaction. However there are a few documents that are essential for every dataroom:

Legal Information It includes articles of incorporation, intellectual property registrations, and employee stock agreements. Also included is the cap table that breaks down ownership stakes as well as percentages of your company. Founders can also opt to include any previous investor updates, which show investors that they are serious about investor communication and transparency.

Financial Information It includes the financial statements of the past and the future and provides sources, assumptions and the logic behind those projections. Founders may also include their business plan as well as a product roadmap here.

Founders can choose to break the investor data room into sections and restrict access by granting different user roles. For instance, a section might contain documents for strategy and pitch decks which will be accessible to early stage investors, whereas https://floridavdr.com/top-virtual-data-room-providers-in-india/ the other section will contain more detailed legal documentation for investors who are more serious. This lets them save time by only sharing documents that they need, and allows them to have greater control over the sensitive information they share.