Traditionally, companies kept important documents in a safe area that potential buyers could access during due diligence. Today these documents are stored in the data room. Investors can access documents such as your articles of association along with your patents, intellectual property as well as the legal structure of your business. This includes stock vesting, contracts and a cap-table (which indicates who owns what).
It’s important to have the correct documentation ready in a timely manner when you’re preparing for an investor, a sale, or an acquisition. This will speed the process and lowers the chance of omitting an important item.
Virtual data rooms offer a safe environment for sharing and keeping IP and licensing documents. Security features such as audit logs and user permissions settings, watermarking, and restrictions on printing/download help prevent information leakage and data breaches.
Lawyers are often faced with large volumes confidential documents during a case. Virtual data rooms are a great option for handling this kind of material because of their secure encryption methods and granular security controls. VDRs also permit lawyers to share and collaborate on files with clients, while keeping confidential information.
An investor data room should be created at the time you begin selling to investors, so that they can see all of your relevant information during due diligence. This will help them understand the product you’re selling, and will be able to make an informed decision as to whether or not they want to collaborate with you.
https://nuclearsafetyforum.com/best-virtual-data-room-providers-for-data-safe-keeping
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