Virtual Data Rooms for Private Placement

By April 29, 2024 No Comments


If your company is contemplating a private placement (PP), you will need to share critical sensitive documents with potential investors/partners. Instead of relying solely on email or spreadsheets, a virtual data room is a good alternative that offers an organized and secure environment to share information with multiple parties.

PPM Preparation: You can build a document library that has customized permissions for each prospective partner/investor and track usage metrics to gauge the level of interest. Dynamic watermarks Print, view only and view permissions, as well as access expiration can prevent unauthorized use of sensitive documents. Physical Security The physical security of your VDR should have facilities that are of a professional standard with multiple backups as well as offsite storage. Also, there should be redundancy, fire protection and biometric access. They should also use strict access controls including forensic auditing, forensic auditing, and multi-factor authentication.

Investment in your own business You can upload confidential revenue forecasts and IP ownership documents to give potential investors an accurate picture of the growth potential of your company. You can also upload a cap table showing how equity is split between the founders and investors who are already in place. This will speed up due diligence process and enable you to move quicker towards the termsheet.

A virtual dataroom also facilitates collaboration between internal teams and external partners by allowing users submit specific questions regarding documents in a dedicated section. The person responsible for answering them can respond them as soon as possible. This reduces the time spent looking for information in emails or sending files that could be lost.

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