A data room for investors is a central repository where documents can be shared with potential investors or financial backers. It allows rapid, efficient and well-organized access to information without having to send multiple versions of the same document by email. The data room is also secure, with features such as watermarks, expiring links, password protection and the ability to grant permissions in a way that makes it easy to restrict access to sensitive information.
There are a variety of documents that need to be made available to prospective financial backers, from basics such as your term sheet, capitalization table and round of investments to more in-depth due diligence documents, such as the most current financial statements (both historical and projected) and HR documentation like founders’ resumes, employment contracts and employee stock options. It is also recommended to include technology-related documents such as system architecture, integrations and the existing product documentation.
The more information dataroomtools.com you provide the more details you include, the longer it will take investors to go through it. The more information you share more information, the greater the chance that sensitive information will be compromised or misused. It is important to balance the need for clarity while limiting the amount of data you share to be able to move quickly.