How Startups Can Use a Data Room to Share Documents With Investors
Most people consider data rooms an instrument to complete due diligence in mergers and acquisitions (M&A), but they can also prove useful to raise capital. Startups might make use of a dataroom to share documents with investors. This is especially true when they are nearing the end of their fundraising campaign. With the appropriate features, a data room can streamline communication and increase confidence in investors.
Typically the data room will have a dashboard that gives a summary of recent activity and notifications. Users will be able to alter the dashboard view and adjust their security settings and notifications. After logging in to the system, users will need to enter their email address, confirm the Terms of Use and Privacy Policies and change their password security settings.
After users have signed into the system, they will be able view and download documents. A data room must have an index to aid users find the document that they are searching for. It should also be easy to edit in the event of need. A data room should also be able to monitor engagement on specific documents.
A data room should include an area for Q&A where questions can be posed and answered. The platform can categorize the responses to questions and even pinpoint specific words and phrases that should be censored using its proprietary artificial intelligence engine. The system can mark these text sections with the red flag, and label them in a way that will allow for future references.
