A data room is a space that can be used to store sensitive documents with a sensitive nature or privileges during due diligence for M&A transactions. Virtual data rooms are becoming more popular than physical rooms to serve this purpose. They provide the same level security as traditional methods.

Investors can review the documents within hours and not weeks or months. The new entrepreneurs might be unable to decide what information they should include in their investor data rooms. Fortunately, there are basic guidelines that can be used as an excellent starting point.

Investors are seeking key information that will provide them with a better understanding of your company. This may include your financials, market research, and a clear and concise presentation of your business plan. It’s important to keep in mind that the amount of information you need to provide an investor will vary based on the stage that your business is at. An early-stage startup will need to present fewer financials to a Series A company.

It’s essential to not share fragmented or unconventional analyses because this could make it difficult for investors to follow the data. It’s also not recommended to share non-standard charts or graphs except if they add nuance and depth to your presentation. This can be done by focusing on important metrics that are easy to comprehend for investors (e.g. by highlighting retention or engagement cohorts).

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