When it comes to closing a round of investments, how you present your company — specifically, how you present the documents that measure your company’s strengths and performance — is key. The goal, of course, is to present the most accurate and compelling picture of your company to a group of prospective investors who see the value of investing in the business for potential profit.

A data room is the best platform to enable the secure sharing of sensitive data between parties that are in the process of investigating one another. Let’s have a look at the ways to leverage data rooms during the fundraising process, including best practices for setting it up, and what should and should not be shared.

The Documents

Because the primary purpose of the data room is to present a company’s potential for future profit to a group of investors, the following legal documents should be considered for inclusion:

  • Legal structure and articles of incorporation
  • Records of previous capital raise and liquidity events
  • Board of Directors’ meeting minutes or previous actions
  • Business plans
  • Company financials, including profit and loss statements and projections
  • Tax returns, audits, financial evaluations and other reports from third-party professional service providers
  • Intellectual Property, including patents and trademarks
  • Product and service information, including roadmaps
  • Marketing plans, strategies and assets
  • Sales strategy and pipeline, including existing customers MRR and ARR
  • Sensitive information about employees, including compensation and contracts
  • Technology investments
  • Additional operational liabilities, including capital expenditures, commercial leases and investments in R&D

While the list above details everything that could be applicable to your deal, it’s also important to note that not every business document needs to be included in your investor data room. Here’s why:

  • Additional documents require more time for review and analysis and could slow down the due diligence process and the eventual disbursement of funds to the company.
  • Irrelevant documents can distract, confuse or leave the interested investor thinking, “What value does this serve?”
  • The more confidential documents included, the higher the risk of potential misuse or compromise.

Remember, additional documents can be saved for the next stage of the investment deal after the potential investor has expressed initial interest and wants to move forward.

The Mechanics

Create a base structure that includes all of the company documents — but create different views and access rights for the individuals evaluating your documents. In this way, content is tailored and unique for each person. For example, the investor’s legal counsel may not need to see certain sales and marketing documents.

Here are a few additional considerations when setting up the data room:

Personalized Views

Create a base structure that includes all of the documents — but create different views and access rights for the individuals evaluating your documents. In this way, content is tailored and unique for each person. For example, the investor’s legal counsel may not need to see certain sales and marketing documents.

Read-only Access

Be sure that no document can be altered, copied, shared or printed without your permission.

Securely manage confidential information, M&A activity, and more with CapLinked.

Tracking Measures

The data room should provide a single view as to who has accessed what company documents at what time and for how long. If you notice any unusual activity, such as attempts to print or share, you can be alerted and take appropriate measures with that individual. Further, you might notice that certain documents haven’t been accessed at all; you can ask why or consider if that confidential document needs to be included in future investor data rooms in which you participate.

Ability to Easily Make Updates

The data room should enable you to make painless investor updates — removing or adding documents without much hassle. You should not have to start from scratch if you need to make a small change.


Short messaging or commenting should be built into the data room. This facilitates the review process and doesn’t force investors to leave the platform in order to send a message or make a comment if needed.

Something Different

Keep in mind that investors regularly review hundreds of companies’ financials and documents every month, seeking valuable insight into their potential investments. While there are the “usual suspects” regarding documentation, consider presenting your documents in a slightly different way. This could simply be the user interface of your data room. Choose a data room provider that leverages extensive UX capabilities so that your company can really stand out from the crowd and capture the attention of interested investors.

The Best Solution for an Investor Data Room

While thousands of pages of highly-sensitive documents are handled by dozens or hundreds of people in an investment transaction, security features and tracking are needed to ensure that the right access has been granted and has not been compromised. For optimal security and organization in your investment transactions, choosing a robust data room for investors like CapLinked can provide the necessary digital rights management and file protection features.

Organizations should consider an enterprise virtual data room solution, such as CapLinked, that has these needs in mind. Digital rights management capabilities provide encryption and complete control over how a document is used, edited, copied or even printed. Caplinked’s FileProtect feature lets companies share documents while retaining the ability to deny access to anything even after it’s downloaded.

In today’s “anytime, anywhere” environment, documents are most likely accessed via multiple cloud platforms. Caplinked provides cloud integrations with such platforms as Salesforce, Dropbox, Box, Google Drive and OneDrive. Start your free trial today!

Jake Wengroff writes about technology and financial services. A former technology reporter for CBS Radio, Jake covers such topics as security, mobility, e-commerce, and IoT.