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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. Most often, it is used during mergers and acquisitions, due diligence and fundraising, the platform allows confident information exchange and prevents sensitive documents from ending up in the improper hands.

The best data rooms feature clear folder structures, and an index that lets users find information by topic or filename. Some allow the control of versions, which ensures that everyone is working with the latest version of a document and can easily monitor changes. PandaDoc is a popular provider of data storage that provides all of these features, along with bespoke tracking and analytics, watermarking for downloaded documents as well as a cyber-secure environment.

The first step in establishing a data room is to decide which documents will be included. The most commonly used areas include legal (Articles of Association and IP registrations), finance (profit and loss statement, balance sheets) and documents for the company’s formation. This includes a cap table that has been updated that clearly shows the percentage of ownership for the business. It is essential to not share any unnecessary information, like non-standard analysis that is not relevant to the company’s present or future health. It is also a good idea for you to keep track of the people who have access to your data room. This allows you to eliminate the ones who aren’t required and update permissions for those who still have access. This will ensure that only the most up-to-date and relevant information is available for viewing.

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