Founders quite often struggle to make a decision what data should be integrated into an investor data area. Put too much in, and you simply could whelm investors. Place too little, and so they Virtual Data Room could question your preparedness.
When buyers may inquire access to a virtual data room throughout the whole deal flow process, the most common requests come at two specific levels. Stage 1 involves data that is essential for an investor to create a term list (i. age. investment memos, financial units and capitalization tables). This may also include a few areas out of Stage two in lower detail (e. g. the bios of the top team members).
Level 2 commonly occurs after you’ve received a term sheet and are moving forward with all the investment (i. e. discussing final conditions and shutting the deal). It needs much more precise due diligence info, including firm documents (corporations, LLCs and partnerships), securities-related documents, material negotiating, financials and staff.
If you’re at the Stage 1 or Level 2 point, a well-organized investor data bedroom is key to facilitating a competent due diligence process. An important concern is that the platform you choose to your investor info room gives a single viewpoint into who has accessed what document, by what as well as for the length of time. It should likewise allow for convenient updates, including removing or perhaps adding paperwork. Getting this kind of right will let you avoid any unpleasant amazed down the road.