A data room for investors is a central repository where documents can be shared with potential investors or financial backers. It provides rapid, efficient and well-organized access to documents without the need to send multiple versions of the investor data room same document by email. The data room is safe with features such as expiring links and password protection, as well as watermarks and granular authorizations.
It is necessary to share many documents with potential financial backers. These include the essentials like your termsheet, capitalization table and investment rounds, along with more detailed due diligence information such as the most recent financial statements (both historical and projected) as well as human resource documentation, such as founders’ resumes as well as employment agreements and employee stock option plans. You should also include any technology-related documents such as system architecture, integrations and the existing product documentation.
The more you include the more information you include, the longer it will take for investors to read. The more details you provide, the greater the risk that sensitive information will be abused or compromised. It is crucial to balance the need for clarity with limiting the amount of information you share to move forward quickly.