Investors are interested in all information they can gather about startups prior to investing. Investors want to know everything, from competitor analyses to financials and much more. The more organized the founders are more organized, the easier it will be to conduct due diligence for investors. One way to help the process run more smoothly is to create a data room for investors that includes all the relevant information and documents.
What documents should be included in an Investor Data Room?
Although every startup is unique, the majority of documents required to complete an investment round are the same. A few examples of the most crucial documents that should be included in an investor data room are strategy documents such as pitch decks, product plans, as well as company bylaws, or articles of organization.
Furthermore, investors are likely to want to review employee agreements, non compete agreements, and stock option agreements. These types of documents are usually extremely sensitive, so having them stored in a secure, easily-accessible online repository is the most effective way to ensure they are only shared with authorized third parties. Using a virtual data room solution like CapLinked’s, which has digital rights management features allows users to control the way a document is utilized, ensuring that only those who require it are given access.
Include previous updates of investors in a database room online to demonstrate potential investors that you are transparent, and that you will provide them with information during the fundraising process. It can also help establish trust in the process, allowing you to advance your fundraising faster and more efficiently.
