What is an Investor Data Room?

Investor data rooms are the places that startups can store documents for due diligence that can be utilized by potential investors or http://vdrtechnology.info/get-a-better-end-result-in-your-deals-by-following-these-rules/ acquirers in a fundraising round. These are documents that do not fit into a pitch deck or a slideshare presentation, and that prospective financial backers must examine prior to investing or sign a term sheet.

These documents are essential for investors as they assist them make decisions quicker and easier, which reduces the amount of time investment managers need to devote to the deal. They also make them feel like they are part of the startup’s team which helps build trust and leads to more informed feedback.

The most secure investor data room also gives startups visibility on who has access to which information and ensures that sensitive documents do not fall into the unintentional hands. Transparency allows startups to tailor their conversations with investors and enhance the results of any transaction.

A shared folder can function as an investor dataroom seed or angel investors. However, software designed specifically for investors is a better option, particularly for Series A rounds and higher. A high-end virtual dataroom solution is more affordable than consumer grade software, and offers advanced security features, an efficient file search, and other features. Some even offer digital right management (DRM) which is a feature that secures documents so they can’t be printed, edited or copied by anyone outside of the platform. CapLinked’s Investor Data Room service is a good example. this feature as well as others.