For entrepreneurs who are starting their own ventures due diligence is a crucial element in their process of raising capital. A virtual data room provides the founders total control over the documents they provide to investors, unlike emails. Folderit lets startup founders make sure investors only receive the documents they need.
The contents of an investor data room for a startup is dependent on the type of business. However, most include documents that are relevant to due diligence. A life science company, for example is required to include information regarding HIPAA compliance as well as clinical trial results. These documents are typically too large to be sent via email. A virtual data room is the best way to share these documents with investors.
Investors conduct due diligence in order to evaluate the potential of a startup’s success and minimize their risk. Having all the information they need in one place accelerates the process and makes it easier for them to make a choice. It also shows that the founders take their investors’ time very serious, which is essential to the majority of investors.
Since investors are limited in their budgets It is crucial for startups to select a service that offers a flat fee structure. Startups that are still fundraising benefit from per-page pricing for documents written in text which is significantly less than a subscription-based model that offers unlimited storage and users. A trial offer allows entrepreneurs to test the platform provided by their provider and practice reenacting their presentations with investors, and sketch out the layouts of their documents.