For the principals of a young company, going public is both the end of a long journey, and the start of something new. All that stands in the way is the IPO process itself, and then attracting the right investors.
Unfortunately, the IPO process is no fun: it is a time-consuming task that requires maximum focus from your team. For most companies, preparation and filing takes 18 months and costs around $750,000. In the course of your due diligence, you will need to amass hundreds of confidential documents:
- Three to five years of financials performance reports, including annual reports, tax filings, profit and loss statements, the general ledger, accounts payable statements, and a schedule of the latest accounts receivable
- Articles of incorporation and bylaws
- Names of board members and shareholders and an organizational chart
- Records for partnership agreements, vendor and supplier relationships, and agreements to purchase securities
- Inventory and assessment of physical assets, including real estate, manufacturing equipment, office equipment and supplies, inventory, and raw materials
- Statements that present how your company ranks within its industry vertical and compares to its competition
- Forecasts of avenues for growth, as well as significant challenges or risks.
Clearly, these documents need to be kept confidential, not only from competitors but also from hackers, who are well-schooled in attacking companies preparing for an IPO. You will need a level of security far more rigorous than file sharing by email, collaboration platforms like Slack and Skype, and file hosting services like DropBox, Box, Google Drive, or Microsoft SharePoint and OneDrive.
Use a Virtual Deal Room
The best way to ensure confidentiality for confidential documents is to use a virtual deal room, sometimes called a virtual data room (VDR). A VDR is an ultra-secure online platform designed to store and share confidential documents. Once an authorized user enters the VDR environment, he or she can securely access and share documents, and work together on developing the due diligence report and regulatory filings.
ShareVault has been the VDR of choice for more than $50 billion in financial transactions, including IPOs. Based on that experience, ShareVault is the best platform for taking a business public.
Here are ways a ShareVault VDR can help during IPO preparation:
Organized Central Location
IPO preparation requires extensive due diligence from all parties involved in the process. A virtual data room provides a single centralized hub for all the relevant archived and work-in-progress documents. Having a single point of reference for your team will save time and resources and allow you to get to market faster.
Enhanced Security
A VDR from a quality provider like ShareVault provides a full array of safeguards:
- All documents in the VDR are automatically encrypted
- Access to documents is limited to an authorized list of users who gain access using a two-factor password
- Even those who have access have defined permissions for use, such as save, print, copy, or view only, and expiration dates on access
- Protected access and document sharing can be extended to analysts, accountants, the legal team, regulatory experts and other third parties, even those in remote locations
- When the time is right, access can be extended to investors, IPO underwriters, and regulatory officials.
Faster Due Diligence
ShareVault improves the IPO preparation process by providing a Due Diligence Checklist, a built-in system for file organization that significantly improves the speed and accuracy of your filing.
Using the Due Diligence Checklist, your IPO prep team can make use of ShareVault’s built-in software to make document organization and access fast and easy. Among the software’s features:
- Intuitively designed software, enabling users to gain proficiency quickly
- An organizing template with folders - just name them and get started
- A user invitation system that sets up the two-factor passwords and registers the IP address of every user device
- Drag-and-Drop for uploading files or changing files from one folder to another
- Bulk uploads to speed the process of populating folders
- Seamless Integration with DropBox, Box, SharePoint, OneDrive, DocuSign, and other file sharing apps
- Hierarchical Tags: hashtag links to important files so they can appear in multiple folders
- Index Auto-Numbering: Numbering automatically adjusts as you add or delete documents
- Instant Full-text Search: Keyword search results display in context
- Favorites tags, so a user can quickly return to important documents
- Q&A is a feature within each document where a team member can pose a question and receive replies from designated experts.
In addition to these time-saving and productivity enhancing features, ShareVault has a monitoring software feature that tracks every interaction by a user with a document. Results can be shown as a scrollable list of events or a graphical timeline. ShareVault tracking software is a necessary response to audits by third parties, including regulators.
Faster and Better Investor Reviews
A ShareVault VDR is not only a superior way to prepare your IPO due diligence brief but is also the best way to present your company to investors and underwriters. The VDR administrator simply follows the same security protocols as he or she did with your team. Once within the secure VDR, investors can conduct their own due diligence efficiently, thus speeding the end goal of a successful IPO.
If investors and underwriters have questions, ShareVault’s software tools allow your team to respond quickly and in an orderly fashion. They will also note your company’s dedication to security, which is a big plus for your brand.
Set Up a ShareVault Virtual Deal Room Today!
With ShareVault, you protect your sensitive documents, limit access to authorized users only, and provide a centralized location for your team’s due diligence preparations.
ShareVault knows the IPO process and with a three-tier pricing plan, we can customize a VDR to meet your organization’s needs. Contact us today to discuss your IPO preparation needs!