Creating a Data Room for Business

A data room is an online location that allows you to safely share files and confidential information with other parties. Commonly used in mergers and acquisitions, due diligence, and fundraising, the platform allows confident information exchange and prevents sensitive documents from falling in the inappropriate hands.

The best data rooms have an organized folder structure and an index that lets users find information based on topic or filename. Some also allow for revision control, ensuring that everyone is working with the most recent version of a document and easily monitor changes. PandaDoc is a well-known provider of data storage that provides all of these features as well as custom analytics and tracking watermarking for downloaded files and a secure environment.

The first step in creating a dataroom is to decide which documents will be included. The most common areas are legal (Articles of Association and IP registrations), finance (profit and loss statements and balance sheets) and documents pertaining to the company’s formation. This includes a cap table that has been updated that clearly shows the percentage of ownership of the business. It is important not to divulge any other data like non-standard analyses which are not relevant to the present or future performance of the business. It is also a good idea to keep track of all users who have access to your data room. This will allow you to delete users who do not require access and also update permissions for those who still need access. This will ensure that only the most recent and relevant information is available for viewing.