What investors look for in a data room
What an investor needs your data room to answer, the ten folders to build it on, the Indian records they test, and who sees what, and when.
Summary
- An investor data room is the investment case in documents. It shows what the company has done, where it is going, how it gets there, who backs it and what return is possible.
- Build it on ten numbered folders: a start-here folder with a two-page note, then the nine areas of the standard request list. A monthly close keeps the financial folders current.
- Investors test the Indian share records, the existing backers and the plan for the next five to ten years. Give access in two stages, with contracts and pricing held back until a term sheet.
I have completed more than 100 due diligences. In most of them the room held every document somewhere, and very little of it argued for the company.
The founders had treated the room as storage. The investor was left to build the case alone, from folders named by whoever uploaded the files.
A is the investment case set out in documents, and every folder should help an investor argue for the company at their investment committee.
What is an investor trying to answer from your data room?
The room should answer five questions without anyone picking up the phone.
- What has the company done? Revenue, customers, margins and cash, from audited accounts and monthly MIS.
- Where is it going? The plan for the next five to ten years.
- How does it get there? The operating plan, the hires, the model and the money each stage needs.
- Who already backs it? Existing investors, the board, and the people who vouch for the founders.
- What return is possible? The price of this round, the to come and the routes to an exit.
The person you meet is rarely the one who decides. A partner or an analyst takes your company to their investment committee and argues for it against other deals.
The person you meet is rarely the one who decides.
A room that makes them chase documents, or explain gaps you left, costs them standing in their own firm.
Organise the room on one ten-folder index
SRF Capital Studio now builds its data rooms to one index. Nine folders follow the standard request list, under a start-here folder with a two-page note.
SRF's data room index: a start-here folder above the nine areas of the standard request list
| Folder | What goes in it |
|---|---|
| 00 Start here | The two-page note and short recorded walkthroughs |
| 01 Corporate | Incorporation documents, Articles, statutory registers, minutes |
| 02 Share capital | Cap table, allotment returns, valuation reports, convertibles, ESOP records |
| 03 Shareholder arrangements | Shareholders' agreements, side letters, existing investors' rights |
| 04 Financial | Audited accounts, monthly MIS, board packs, investor updates, the model; the plan and capital strategy in their own sub-folder, shared in the first stage |
| 05 Tax | Income-tax and GST returns, assessments, open notices |
| 06 Contracts | Customer, supplier, lease and loan agreements, executed only |
| 07 Intellectual property | Trademarks, licences, assignments from founders and contractors |
| 08 People | Organisation chart, senior employment terms, grant letters, references |
| 09 Regulatory | Licences, foreign investment filings, sector approvals |
The nine areas are the ones in our guide to what a diligence team opens first. Numbering them lets you answer a request with a folder reference. It also tells the reviewer the company keeps its records in order, before they have read a page.
Name every file to one rule: the date, what it is, and whether it is executed. Only signed, final versions go in, so nobody has to ask which draft governs.
The note in the start-here folder is the one document every visitor reads. Keep it to two pages: what the company does, what it has achieved, what this round pays for, and where each answer sits. Write it last.
Beside the note, add three recordings of five to ten minutes each. A founder presents the deck, whoever owns the numbers explains the model, and someone shows how the folders are laid out. A screen and a voice are enough.
A recording carries your explanation into meetings you are not invited to.
A recording carries your explanation into meetings you are not invited to.
The room SRF organised for 31 Parallel, before this index existed, held more than 200 documents in six groups: corporate, financial, commercial, legal, technical and HR. At that size, an index and a covering note decide whether a reviewer finds anything.
Keep the financial folders current with a monthly close
Investors read the operating record closely: monthly MIS and management accounts in 04 Financial, board packs and investor updates beside them, and board minutes in 01 Corporate.
Twelve months of investor updates and board minutes let an investor check what management promised against what the company then delivered.
A board pack and an investor update are different documents for different readers, as our piece on board and investor reporting explains. Both belong in the room, and both must come from one set of numbers.
A data room stays current only when the books close every month, because the financial folders are then copies of records the company already keeps.
A company that closes its books once a year rebuilds those folders for every round, under deadline. Each rebuild is a chance for the numbers to drift from what the investor saw first.
SRF manages 40+ enterprise CFO offices, and in those offices the monthly close keeps the records an investor asks for ready between rounds. Setting up that close is the work of our controllership practice.
Check the Indian records an investor tests against your cap table
In an Indian company the is only as good as the filings behind it, and investors test them early. File each record by round in 02 Share capital or 09 Regulatory, so one allotment can be followed from board resolution to return.
- Form PAS-3, the allotment return, filed with the Registrar of Companies within 15 days of a private placement allotment (30 days for other allotments, such as exercises).
- Form FC-GPR for every issue of shares or convertibles to a foreign investor, reported to the RBI on its FIRMS portal within 30 days of the issue. A late filing can be regularised with a late submission fee within three years of the due date; after that it needs compounding.
- A valuation report for every round. In an unlisted company, shares issued to a foreign investor must be priced at or above fair value. A chartered accountant, a -registered merchant banker or a practising cost accountant certifies it.
- A registered valuer's report for a preferential allotment under the Companies Act, and the income-tax valuation where one applies. Since 1 April 2026 that method sits in the Income-tax Rules 2026, which replaced Rule 11UA.
- For rounds raised before the was abolished from assessment year 2025-26, the income-tax valuation that supported the price.
- on the cap table at their conversion terms: compulsorily convertible preference shares (CCPS), compulsorily convertible debentures (CCDs) and iSAFE notes, which are usually issued as CCPS. Show the fully diluted count beside them.
- The ESOP record: the shareholder approval, the written scheme and every grant letter, matching the pool on the cap table. Our ESOP guide for founders covers how the pool should be set up.
None of these is hard to file on time. Each is slow to repair once a has set a closing date.
Show who backs the company and who vouches for its founders
Existing investors belong in 03 Shareholder arrangements, where they are easy to find. Say who they are, what they hold, and what rights they carry, such as board seats, information rights, consent rights and .
Before the room opens, ask each existing investor whether they will invest in this round, and write down the answer. A backer who is not investing again raises a question every new investor will ask, so give the reason yourself.
For each founder and senior leader, name two or three people who have seen their work closely, such as a former manager, a customer or a co-investor. Tell them to expect a call, and list them in 08 People.
Prepared references and a plain account of existing investors answer two questions every new investor asks early: who vouches for the founders, and who already backs the company.
Open the room to investors in two stages
Give access in two stages. Contracts, pricing, employee terms and the monthly detail wait for a term sheet, and open once confidentiality is agreed, in an NDA or the term sheet.
The first stage holds the start-here folder, the deck, summary financials, the cap table, the model, and the plan with its capital strategy. Put nothing in it you would mind a competitor reading, because many funds will not sign an NDA before a first meeting.
The model belongs in the first stage. Before a lead investor issues a term sheet, expect their team to work from your model and test it.
Keep sensitive files view-only, and keep a log of who opened what. The log tells you which investor is doing the work.
Run the raise to dates: when the first stage goes out, when the second opens, and when you expect term sheets. Put that timeline in the start-here note.
Put the plan for the years ahead in the room
An investor prices the round on what the company will become, so a room that ends at last year's audited accounts leaves out what sets the price.
Set out the plan for the next five to ten years with numbers behind it: the milestones, the hires, the markets and the capital each stage needs. The model should carry the same plan, year by year.
From , investors write exit rights into the shareholders' agreement, so set out the realistic routes now. Name them: a sale to a strategic buyer, a later fund buying the stake, or a listing.
The plan also needs to show how each stage is paid for, round by round, until the company funds itself. Sriram Chidambaram, SRF's founder, covers how to build that in his piece on the startup funding roadmap.
Walk the investor through the model before their analyst rebuilds it: the base case, the downside case and the few assumptions that move each one.
Five things to do with your data room this month
- Write the two-page note for the start-here folder. If it is hard to write, the room has a gap.
- Sort every file into the numbered folders, rename it to the naming rule, and take out drafts and duplicates.
- Match the cap table to the PAS-3 and FC-GPR filings and to the valuation report for each round.
- Add twelve months of MIS, board minutes and investor updates, and check that their numbers agree.
- Ask each existing investor whether they will invest in this round, and name references for every founder.
If you want a second view before investors arrive, our data room work builds the room to this index. A pre-due diligence review finds what an investor would find first, while there is still time to fix it.
Current as at November 2026. General guidance drawn from our diligence work, not legal or tax advice: take advice on your own situation.
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The services behind this article
What we do about it, for founders and finance teams. Each has its own page.
Data Room Preparation
A data room that answers the question before it is asked, assembled before the process starts rather than during it.
Investor Readiness
The model, the deck and the market case that survive a second meeting, prepared before the raise, not during it.
Pre Due Diligence
Preparation frameworks that get a business ready before investor or acquirer scrutiny begins, not during it.
Controllership
The controls, reporting structures and governance systems that make a company's numbers trustworthy.
