If you are starting to meet with investors, you are going to need to pull together a bunch of information to share with them as part of the due diligence process. It’s better if you do this early, stay organized, and have it ready to share when requested.
A data room can be done in any type of file sharing that you feel comfortable. You can use a Dropbox folder or Google Drive or anything similar. It is going to be filled with highly confidential items, so make sure it is secure. This should be organized into four big sections.
First comes the background information on your company. In this section, you should have a list of the key members of your management team with short bios and URLs for LinkedIn profiles. You should also include a simple company organizational chart and a list of individuals on the Board of Directors or Advisory Board, if applicable. You should also include in this section any key hires that have already been identified to be made after your capital raise.
Second up is a section with your company documents. This should include the Cap Table, company Operating Agreement or other governance document, Articles of Incorporation, Certification of Good Standing, and Tax ID Letter. It should also cover your office lease agreement or description of office arrangements if in co-working, executed documents for any prior capital raise or debt/loans, and employee stock/option plan document, if applicable. You will need in this section to include copies of key contracts like employment contracts and material contracts with customers or vendors. Finally, include the offering documents, Subscription Agreement, and any other docs required to close the funding.
The third section is about your product or solution. Include a description of what you are bringing to market along with technology or product roadmap for the future. Have in this section user/customer historical stats and stats on paid promotion or customer acquisition too.
In the fourth and final section, the focus should be on the financials and capital situation for the company. You’ll need a basic financial model projection for the next three years, but please don’t drive yourself crazy on this, just keep it simple. Include year to date and prior year company prepared income statement and balance sheet, or whatever you have since inception. You’ll want to add your prior year corporate tax return (if any) and three month’s of bank statements. Pull together a list of any significant Accounts Payable (>$10K) and a summary of the terms on any debt or loans outstanding.
That should pretty well cover it. Some investors may have something specific they ask for that is not on the list, that’s OK. And don’t worry if you do not have everything listed available here, just do your best and see what feedback you get.