Short answer: A due diligence data room is a secure online folder structure where the seller (or a company raising money) shares the documents a buyer or investor must check before signing. Set it up with about nine numbered folders – corporate, financial, tax, commercial, legal, IP, employees, assets and IT – open it only after an NDA, release the most sensitive files in stages, and track who reads what. Most small and mid-sized deals run 4–12 weeks; a room prepared before the first buyer arrives makes them shorter.
Updated 9 November 2026. Disclosure: HelpRange makes data room software.
Due diligence is the buyer’s or investor’s check of a business before a deal is signed. It answers three questions: is the company what the seller says it is, what could go wrong after closing, and what should that do to the price and the contract? Lawyers review corporate records, contracts and disputes; accountants test the numbers behind the valuation; specialists look at tax, IT, employees and, where relevant, environment or real estate.
The data room is where all of that happens. Instead of e-mailing hundreds of files, the seller uploads them once into a numbered folder structure – the data room index – and invites each party with its own permissions. A good room does four jobs:
The same applies to a fundraising round (investors check the company), a real estate sale (buyers check the property and leases) and vendor due diligence (the seller commissions the reports itself before going to market).
This is the structure most sell-side advisers use. Keep the numbers: they become folder names in the room and references in every question and answer. Mark items that do not exist as “not applicable” instead of deleting them – it shows the buyer the question was considered.
| Folder | What goes in | Who reviews it |
|---|---|---|
| 1. Corporate | Certificate of incorporation, articles of association, shareholder register and fully diluted cap table, shareholders’ agreements, board and shareholder minutes (3 years), group structure chart, powers of attorney | Corporate lawyers |
| 2. Financial | Audited financial statements (3 years), monthly management accounts, budget and forecast, quality of earnings report, debt and financing agreements, working capital analysis, revenue by customer and product | Accountants, transaction services, lenders |
| 3. Tax | Corporate tax returns (3–5 years), VAT and payroll tax filings, tax audits and correspondence, transfer pricing documentation, tax losses carried forward | Tax advisers |
| 4. Commercial | Top 20 customer and supplier contracts, customer concentration and churn, pricing and discount policies, pipeline and order book, distribution and partnership agreements | Buyer’s management, commercial advisers |
| 5. Legal | Pending and threatened litigation, licences and permits, contracts with change-of-control clauses, material contracts register, regulatory correspondence | Lawyers |
| 6. Intellectual property | Patents, trademarks and domains, IP assignments from founders, employees and contractors, in- and out-licences, open source usage report | IP lawyers, technical advisers |
| 7. Employees | Organisation chart, key employment contracts, incentive and option plans, headcount and payroll summary, pension obligations, employment disputes | Employment lawyers, HR |
| 8. Real estate & assets | Leases and property titles, fixed asset register, insurance policies and claims history, environmental permits and reports | Real estate lawyers, insurers |
| 9. IT & data protection | IT systems overview, GDPR records of processing, data breach log, security policies and certifications, data processing agreements with key vendors | IT and privacy specialists |
Deal-specific lists with 40–70 documents each: M&A · legal · financial · tax · real estate · startup fundraising · all due diligence checklists
Pick the deal type and untick what does not apply. Download the index as an Excel file with Status, Owner, Due date and Notes columns, copy it to Google Sheets, or download the empty numbered folders as a ZIP to fill on your computer. Free, no e-mail required.
Free to start, no credit card. After signing up, open Data rooms → New data room and add the numbered folders from your index (the ZIP has the same structure); guests see them in the same order, and you see who read which document.
Create this room in HelpRangeThe Excel file has Status, Owner, Due date and Notes columns and a status drop-down. A practical starting point – adapt it with your advisers.
Need folders for a specific industry – biotech, SaaS, solar, real estate funds? The AI data room index generator builds one from a sentence about your deal. Full page: due diligence checklist tool.
Opening everything to everyone on day one is the most expensive mistake a seller can make: a bidder who drops out still saw your customer list and salaries. Release information in stages instead:
| Stage | Who | What they see |
|---|---|---|
| 0. Teaser | Potential buyers or investors | An anonymous one- or two-page summary. No data room yet. |
| 1. After the NDA | All interested parties | Information memorandum or pitch deck, summary financials, high-level folders. Customer and employee data aggregated or anonymised. |
| 2. After the letter of intent | Shortlisted bidders and their advisers | The full room: contracts, detailed financials, tax, legal and IP folders. |
| 3. Confirmatory / clean room | The preferred bidder, often only its outside advisers | Competitively sensitive data: customer names and prices, individual salaries, source code, trade secrets. |
In practice: one group per bidder (so bidders never see each other), folder permissions per group, view-only for the sensitive folders, a watermark with the reader’s e-mail on every page, and an expiry date on each invitation. When a bidder drops out, end its access the same day.
A typical sale of a small or mid-sized private company; fundraising rounds are usually faster, large or regulated deals slower.
| When | What happens |
|---|---|
| 2–6 weeks before launch | Agree the index, collect the core documents, fix gaps (missing IP assignments, unsigned contracts), consider vendor due diligence reports. |
| Week 0 | Teaser out, NDAs signed, stage-1 access opened. |
| Weeks 1–2 | Letter of intent with the chosen bidder; full room opened; the buyer’s first request list arrives. |
| Weeks 2–8 | Review and rounds of questions and answers; management meetings; site visits; new documents added under their index numbers. |
| Weeks 6–12 | Confirmatory due diligence on the sensitive folders, due diligence reports, negotiation of the purchase agreement and disclosure letter. |
| Signing and closing | The room is frozen and archived (often on a USB drive or as an export) as the record of what was disclosed; access is ended. |
Want a budget for the room as well? Compare per-page, per-GB and flat pricing in the data room cost calculator, or check how ready you are with the data room readiness test.
A secure online space where the seller (or the company raising money) puts the documents a buyer or investor needs to check before signing: corporate records, financials, tax, contracts, IP, employees and IT. Access is limited to named people, every view is logged, and documents can be watermarked and kept from being downloaded.
Usually nine folders: corporate, financial, tax, commercial, legal, intellectual property, employees, real estate and assets, and IT and data protection. Number them like an index (1. Corporate, 1.1 Articles of association…) so every request and answer can point to the same number.
The seller, usually with its M&A adviser or lawyers; in a fundraising round, the company. The buyer or investor sends a request list and the seller answers it by uploading documents under the agreed index.
For small and mid-sized private companies, commonly 4–12 weeks from the letter of intent to signing. Preparing the core folders before buyers are invited is the biggest single way to shorten it.
No. Stage access: a teaser and NDA first, a limited room for all bidders, the full room for the shortlist, and the most sensitive data (customer names, pricing, salaries) last – sometimes only for the buyer's outside advisers.
Traditional M&A providers price per page or per gigabyte and often cost thousands per deal. Flat-price rooms cost far less: HelpRange has a free plan, data rooms with NDA from $87 per team a month (Max), or a one-off Deal Room Pass for $199 for 90 days.
Related: M&A data room · NDA before access · Data room pricing report · What is a virtual data room?