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

For founders of startups due diligence is an essential step to raising capital. A virtual data space gives the founders total control over the documents they provide to investors, unlike emails. Folderit allows startup founders to ensure that investors only get the files they require.

The contents of a startup’s investor data room differs based on the industry, however most include documents that are relevant in the due diligence process. A life science firm, for instance must include information regarding HIPAA compliance as well as clinical trials’ results. These kinds of documents tend to be too large to be sent via email, so using a virtual data space is the best method to distribute them to investors.

Investors conduct due diligence to determine the possibility of a startup’s success and reduce the risk. The fact that they have all the relevant information in one place makes the process quicker and more efficient. It also indicates that the founders take their investors’ time carefully, which is vital for the majority of backers.

Because of investors’ tight budgets it is important that startups choose a provider who offers a flat-fee structure. Startups who are still fundraising can benefit from a per-page model for text documents. This is less expensive than a subscription-based model with unlimited storage and users. Also, a trial period for free is a great way entrepreneurs to test their service provider’s platform, and practice reenacting presentations with their investors and outline document organization layouts.

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