Using an Investor Data Room to Facilitate Investor Due Diligence

Investor due diligence is a vital part of any investment process. The more prepared you are, the quicker your investors will be able to finish their due diligence. An investor data room will make the task easier for all parties.

LPs may want to see the full range of documents, including legal contracts agreements with customers and suppliers intellectual property, market research as my company well as cap tables financials, and other. With the virtual dataroom, it’s easy to share files with third parties. This makes it impossible to send duplicate copies or outdated copies. These documents can be presented in a well-organized, easily navigable investor datarooms to show professionalism and organization.

The investor data room could be used to also store and share an investor pitch with a prospective investor. While the investor presentation itself isn’t part of the due diligence supplementary data, many founders include it to provide context and ease the investor’s access to details they require.

Some founders utilize their investor data rooms to store different information for different investors. Certain founders, for instance, have an investor data room that is a “draft” information, or investor data room they only provide to investors who have not yet committed and another set of documents to those who are preparing to sign a deal. This enables them to control the amount of information they disclose at any given point and ensures that only the right information is shared with the right people.