If a business is looking to launch an IPO or close an M&A deal, it must exchange large volumes of documents with potential buyers. These documents must be kept confidential and securely stored and made accessible to bidders on the deal. A virtual dataroom permits buyers to view these documents without having the hassle of handling massive volumes of paperwork or commuting to a business. A reliable VDR stops competitors from gaining access to sensitive information.

Typically, the data room will usually contain financial due diligence documents that are audited and include balance sheets and income statements, as well as other reports. In addition, there will be intellectual property due diligence files that provide details of the company’s intangible assets, including trademarks and branding. Due diligence could also include a section on tax due diligence, which is crucial to recognize and understand the tax liabilities that could be incurred by the business.

Some companies also upload pitch decks and whitepapers to their data rooms. These documents give a concise outline to potential investors of what the company is solving. They also explain how the company is uniquely placed to tackle the issue and what it plans to do to solve it. Founders can also utilize their data rooms to provide information on the current fundraising process. They can also include executed legal documents terms sheets, capitalization tables. A well-designed data room will come with a set of reporting tools which will provide administrators with a fast overview of the activities of users. This includes what documents were viewed, and when.

you could try these out