The number of startups has increased markedly over the past two years, even in the face of harsh conditions like the Coronovirus pandemic. It also means the competition for investors’ attention has increased, too. Wise startups are using the virtual data room solution to conduct the fundraising process. VDRs are known to be indispensable in mergers and acquisitions, but they are just as valuable for fundraising. With a data room, startups have a better chance of being acquired for a large sum, and in this article, we’ll explain why.
Ease of access
Simplicity is a very important modern use case for software solutions. No one wants to deal with a complex application and a loaded interface. For investors, such spaces will only bring more hassle, as in principle, and for you. Cloud technologies have long practiced easy access to rooms from any device and OS at any time, but they don’t all offer in conjunction with simplicity and security. Your employees, you, and potential investors can log into the VDR space from anywhere, and the program interface is simple for users with any technical knowledge. In addition, the solution offers a single sign-on and file viewer feature that makes it easy to review documents. But most importantly, by providing easy access to the system, you don’t put your data at risk because VDR is known for its strong, secure infrastructure.
Fast exchange of organized information
Virtual Data Room lets you organize and organize any number of documents quickly and easily. The platform automatically downloads and indexes documents, supports many files and provides a smart search function to make it easy to find the data you need during due diligence. Keeping your records organized and easy to work with will be a plus during investor decision-making.
With a virtual data room, transactions can be completed and closed much faster. Investors don’t have to come to a physical vault to review documents at an appointed time. You don’t need to meet in person to discuss details because you can do it all in VDR’s secure environment, which offers encrypted chat and Q&A and the ability to annotate and comment on documents.
Improved transparency with investors
Thanks to VDR’s wide range of security features, such as:
- Data encryption
- Double Authentication
- Digital watermarks
- Document copying/printing/editing/transferring/downloading prohibitions
Startup owners can open up all of their most sensitive documents to potential investors without fear of data leakage. This provides investors with full information for informed decision-making and shows the startup’s scheme of work transparency. As a result, the level of trust increases. In addition, VDR offers administrators automatic audit reports that provide detailed information about which documents investors were in, how much time they spent there, and what they did.
Advantage over competitors
All the features the startup data room offers give them an advantage over competing startups in their field. Many startups don’t opt for virtual data rooms, driven by a desire to save costs. By doing so, they slow down the transaction process, do a lot of repetitive and routine activities, and possibly risk their security. If you consider all the potential problems that could arise without a data room, startups’ costs would be much higher than with one. Considering all of the above advantages, virtual data rooms help you gain an edge over your competitors because you will stand out noticeably and show responsibility and seriousness for your business.