Historically, a virtual data room (VDR) was a physical location that provided access to confidential documents during high-risk business transactions like M&As or IPOs. Virtual data rooms (VDRs) are a cost-effective and practical way to handle sensitive information. You can enjoy the convenience and security that VDRs provide VDR offers during significant business transactions, regardless of the size of your company.

During the due diligence process, prospective investors may want to examine a wide range of documents related to your www.gooddataroom.com/what-is-the-purpose-of-a-data-room/ business. This may include financial records and contracts, legal documents, and intellectual property. You’ll have to include a list of clients and an analysis of competitive factors. It is also important to include a section that outlines the expertise and experience of your team.

When you upload your files to the data room, ensure they’re organized and easy to navigate. Create a clear structure for your folders with subfolders and main categories and standard document names and descriptions. To simplify the process of reviewing it’s useful to categorize documents that are closely related. You can further organize your files by creating an overview.

Don’t include too much data since it could overwhelm and divert potential investors. Make sure to share only data that is a needle-moving for the company. Also, don’t present unorthodox analysis that could confuse investors (i.e. sharing only a portion of a Profit & Loss statement versus the whole picture). Be sure that the platform has the ability for investors to contact you a short message or leave a comment.