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How to Run an Investor Data Room

A VC or investor has expressed an interest in your venture and has asked for more data. They want to verify what you have shared in your pitch deck and are seeking more specific information about your business model, traction and financials. An investor data room can assist.

Getting it right can make the difference between winning and losing investment deals. Investors are busy and don’t have a lot of time for slow processes so you need to be ready when an interested investor comes in. Making the proper information available in the virtual data room will help both parties save time and show that you’re serious about fundraising.

To manage a successful investor data room, you must begin by creating an organization structure that is clear and logically labeled. Include only those documents that investors need to conduct their due diligence. This will differ depending on the stage of the deal, but usually includes:

IP Information (patent filings and trademarks)

Documentation relating to people (resumes and employee stock agreements and documents regarding hiring).

Financial Information (historical and projected), including assumptions, sources and the reasoning behind these projections

You might also consider adding documents to prove that your company is compliant with national, local or international regulations. This is a great way to set investors’ minds at ease early on and allow them to feel secure that the business is operating legally. Don’t forget to include sustainability documents in the long term (e.g. a carbon emission reporting system or other environmental sustainability metrics). A virtual data room with data access analytics can help startups to plan ahead of meetings with investors’ stakeholders. This will lead to better conversations and a greater understanding of the issues investors are most interested in.

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