Folderit Offers a Virtual Data Room for Startups to Conduct Investor Due Diligence

Due diligence is an essential step for founders of startups when they are trying to raise capital. In contrast to sharing files via email the virtual data room allows founders to be in total control of the information they share with investors. By using Folderit the founders of startups can ensure that investors only receive the documents they need to see and nothing else.

The content of an investor data room for startups differs based on the industry. However, the majority of them contain documents relevant to due diligence. For instance companies that deal in life sciences will require the results of clinical trials and HIPAA compliance information. These documents are typically too large to be shared via email. A virtual data room is a better method to share these documents with investors.

Investors perform due diligence to assess a startup’s potential and reduce their risks. The fact that they have all the information they require in one place accelerates the process and makes it easier for them to make a decision. It also shows that the founders are taking their investors’ time seriously, which is important for the majority of backers.

Because investors have limited budgets, it’s important for startups to choose a provider that offers a flat fee structure. Startups who are still fundraising benefit from a per-page pricing option for documents written in text which is less expensive than a subscription-based model with unlimited storage and users. Also, a trial period for free is a great opportunity for startup founders to try their service provider’s platform, and practice reenacting presentations with their investors, and sketch out their document’s organization layouts.

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