A data room is a space that can be used to store documents that are sensitive or privileges during due diligence for M&A transactions. The past physical rooms were utilized for this purpose, however thanks to the advancement of technology, virtual data rooms have become increasingly popular and offer the same level of security as traditional methods.
Accessing a thorough investor data room can allow founders to get a deal done quickly in that investors can review the documents in a matter of hours, rather than weeks or months. However, deciding what to include in an investor data room can be daunting for entrepreneurs who are new. Luckily, there are basic guidelines that could be an excellent point of reference.
Investors are looking for key information that will provide them with a greater understanding of your company. This could include your financials along with market research and a clear and concise presentation of your business plan. Keep in mind that the amount of information you share with an investor depends on the stage of your business. For instance, an early stage startup may require fewer financials than a Series A company.
Avoid sharing a variety of unusual or fragmented analyses as this can make it hard for investors to comprehend the data. It’s also not beneficial to share nonstandard charts or graphs except if they add nuance and depth to your presentation. This can be accomplished dataroomlabs.info/5-uses-for-business-intelligence-tools-in-enterprise-organizations/ by focusing on key metrics that are easy to understand for investors (e.g. the importance of highlighting retention or engagement cohorts).