Data rooms are commonly used to complete due diligence for mergers and acquisitions, but they are also useful for raising capital. Startups might consider using data rooms to share information with investors, especially when they are in the final stages of fundraising. A data room that is equipped with the right features can simplify communications and increase investor trust.
Typically, a data room will include a dashboard that gives an overview of the latest activity and notifications. Users will have the option to personalize their dashboard, as well adjust their security settings and notifications. When they log in, users will be prompted to enter their email address, agree to the Terms of Privacy and Use and then adjust their password security settings.
Users will be able moved here to view and download documents after they’ve signed in. A data room must have an index that helps users locate the document they are searching for. It can also be easy to edit in the event of need. Additionally, a data room should be able of tracking engagement on individual documents.
A data room should have an area where questions can be posed and answered. The platform will automatically categorize the responses and questions and can determine certain words or phrases that need to be redacted based on its own artificial intelligence engine. The system is able to mark the text with a red flag and label them in a way that will allow for future references.