When you’re ready to raise funds for your startup, your first meeting with potential financiers often ends in a request that they have access to your data room. But what exactly does that mean? What should it include?
A data room serves as a safe repository of company documents. Its main purpose is to enable authorised individuals to view sensitive information in a safe manner. It is often used in M&A diligence and other business processes where large volumes of confidential information are exchanged. The best online rooms have security protocols for removing and changing information, software search capabilities and standards that allow only authorized personnel to view the data.
Data rooms are more efficient and time-saving than traditional methods of printing and distributing paper copies. The data can be a fantastic read accessed anywhere in the world, as long as you have an internet connection and computer. You can also be assured that your data is safe from fires and other natural disasters by creating a virtual dataroom.
Consider how many employees you will need to access the data room and their technology capabilities when choosing a provider. You should look for platforms that offer free trials to see how they work before you invest. It’s worth asking your friends and colleagues what platforms they prefer, or if they can recommend any. This will help you narrow down your options and make the right choice for your needs.