When pitching investors for their first investment in your business an experienced team and a convincing deck are important. But, it’s also essential to have a well-organized investor data room. This is an important instrument that can speed up the process of fundraising, and help potential investors to perform their due diligence.
What should you include in your Data Room?
Investors want to see as much information as possible about the company they are thinking of investing in, and a data room provides an opportunity to accomplish this. A good investor data room should include all of the essential documents for the company, including financials, contracts and regulatory filings. It should include intellectual assets such as trademarks, patents, and copyrights. It should also include an information stack document on technology, and, if appropriate the business plan.
In addition, a good data room should include a comprehensive business model spreadsheet, which includes all the crucial forecasts and projections that an potential investor needs to know. The spreadsheet should be simple to use, and should have standard file names and formats. Additionally, it’s beneficial to include an overview of the company’s founders, along with their resumes and relevant background information. This will help a potential investor understand the experience of the team and the depth of the product’s expertise. It may also make them feel more comfortable with the risks involved in their investment. This is especially important for early-stage startups that might not have the track record of their mature counterparts.