Seth Masters, Vice Chair of the New York Angels Investment Group, offers advice about how to best set up your deal room for the due diligence process. He notes that one of the most important things founders can do is have a comprehensive table of contents. Seth points out that being able to easily determine what investors are looking for is a great advantage.
VIDEO TRANSCRIPT:
Seth Masters: There’s no one right way to do this, but it’s very helpful to have an overview template that has very basic information, such as name of the company, what’s their address, what is the contact information, communications for at least one or two of the founders, so that you can easily get to them. Also, I would assume that they have a website- what’s the website? Or if there’s more than one of founder, they also have a presence in other spaces. Basic information about funding too, such as what kind of round is it? How much money are they seeking? What’s the instrument, and any information about valuation, for example whether it’s a price round or preferred equity. You’d want to make sure that that is explained. Is it pre or post? Hopefully post. Because at this point, I think I’m shocked that some people still are out there with pre money safes. But making sure that you’ve provided all of the meaningful aspects of what the investment group is looking for.
Maybe it’s on the overview template, there should be a link to the pitch deck. It’s really important because the pitch deck tells you not just a lot of thoughts about the company, it tells you something about the way the company is communicating. Anybody who’s who’s at this who is looking for funding, had better have a deck. If they don’t, they need to create one. Incidentally, some teams have a short two or three minute pitch that they’ve already recorded. So having the ability to upload is good, but I’d say the pitch deck is a non negotiable. You have to have some, some version of that.
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