A business’s valuation and a data room are crucial to due diligence. This is perhaps the most crucial element of the M&A process. Having an organised and comprehensive virtual data room can make the difference between closing the deal or not, as it provides investors with confidence that there won’t be hidden surprises.
The content of your data room must include key documents that are required for most fundraises, including a pitch deck, basic financials (cash metrics revenues projections, revenue projections, and a cap table) as well as past investor updates, and an updated list of happenings and commitments. Your VC should look over all your legal documents, including your term sheet and agreements with other investors, current loan facilities as well as the most recent documents for your company such as an original copy of amended or revised articles and board resolutions.
Another crucial piece of documentation to share is your competitive analysis, showing that you have a deep understanding of your market and that your product is properly positioned. You should also provide customer references and referrals to help the potential buyer know that you’re gaining ground.
It’s also important to update your data room regularly to show that you are committed to transparency and open communication. This can take the form of a quarterly or monthly report that focuses on the top points and any key metrics. Some companies have an KPI Dashboard, which shows that they are committed to engaging with their https://www.webdata-room.info/data-room-benefits-for-investment-banking/ investors.