Financial due diligence for startups.
Financial due diligence tests whether the numbers in your pitch are real and repeatable: revenue, margins, burn, cash runway, working capital and tax exposure. Prepare monthly accounts that tie to bank statements, a revenue schedule by customer, a clean model and your tax filings, and expect follow-up questions on every adjustment.
Financial due diligence room
- 01 Monthly accounts
- 02 Audits and reviews
- 03 Revenue detail
- 04 Bank and cash
- 05 Costs and payroll
- 06 Model and budget
- 07 Tax
How it works for a startup.
Early investors look at monthly management accounts, bank balances and the model. Growth investors and acquirers often hire an accounting firm to produce a quality of earnings report, which reconciles reported revenue and EBITDA to cash and strips out one-off items. For a startup that has never had an audit, this is usually the first time an outsider reads the books in detail.
The questions focus on revenue recognition (especially for annual prepaid contracts and usage billing), deferred revenue, gross margin and what is in cost of revenue, payroll and contractor costs, and burn by month. For SaaS companies, reviewers rebuild ARR, net revenue retention and churn from the customer-level data, so that file matters more than the summary chart.
Finance folders are read by the investor's associate, the accounting firm and sometimes lenders. Spreadsheets need to stay as working files so reviewers can follow formulas, which means relying on watermarks, view tracking and named access rather than PDF-only sharing.
Top 10 data rooms for this job.
Our five measures, re-weighted for financial due diligence. Places 11 to 17 are listed below the cards.
- Setup speed 20%
- Investor experience 19%
- Access control 22%
- Diligence tools 21%
- Startup pricing 18%
- 1 9.4/10First-rate
- $149 monthly
- 14-day free trial
- 8/12 feature checks
- Investor Q&A
- NDA e-signing
- Dynamic watermarks
- View-only and download control
- SOC 2 (hosting)
- 2 8.3/10Strong pick
- Quote only
- Free trial offered
- 9/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- GDPR
- 3 8.1/10Strong pick
- Quote only
- Demo, no trial
- 10/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- GDPR
- 4 8.1/10Strong pick
- $250 monthly
- Free trial offered
- 8/12 feature checks
- Investor Q&A
- NDA e-signing
- Dynamic watermarks
- View-only and download control
- SOC 2
- 5 8.0/10Strong pick
- Quote only
- Free trial offered
- 8/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- 6 8.0/10Strong pick
- Quote only
- Free trial offered
- 7/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- 7 7.7/10Good option
- $299 monthly
- Free trial offered
- 7/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- 8 7.7/10Good option
- $55 monthly
- Free trial offered
- 9/12 feature checks
- NDA e-signing
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- HIPAA
- 9 7.7/10Good option
- Quote only
- Demo, no trial
- 8/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
- GDPR
- 10 7.5/10Good option
- Quote only
- Demo, no trial
- 8/12 feature checks
- Investor Q&A
- Dynamic watermarks
- View-only and download control
- Viewer activity log
- SOC 2
- ISO 27001
Show places 11 to 17
- DealRoom 7.5
- SmartRoom 7.4
- Onehub 7.1
- ShareVault 7.0
- Digify 6.9
- DocSend 6.7
- Venue by DFIN 6.5
Folder index.
A starting structure for this room. Rename folders to fit your company and keep the numbers.
P&L, balance sheet and cash flow by month for the last 24 to 36 months or since founding.
Audited or reviewed statements if any, auditor letters, accounting policies.
Revenue by customer and month, billing exports, deferred revenue schedule, ARR bridge.
Bank statements, account list, cash reconciliation, credit facilities.
Payroll summaries by department, contractor spend, top vendors, cloud costs.
Operating model, current year budget against actuals, hiring plan.
Federal and state income tax returns, sales tax nexus analysis, payroll tax filings, R&D credit claims.
Loan agreements, venture debt, leases, purchase commitments, convertible instruments.
Unit economics, CAC, payback, cohort retention, definitions used for each metric.
Need every file by stage? Use the startup data room checklist.
Must-have features.
| Provider | Investor Q&A | Viewer activity log | Dynamic watermarks | AI assistance |
|---|---|---|---|---|
| Ellty | ||||
| iDeals | ||||
| Datasite | ||||
| SecureDocs | ||||
| Ansarada | ||||
| Firmex | ||||
| CapLinked | ||||
| Citrix ShareFile | ||||
| Drooms | ||||
| Intralinks |
- Investor Q&A
- Funds and buyers ask questions against a file; you assign, answer and publish replies, and the thread stays on record.
- Viewer activity log
- Shows which investor opened which file, for how long and when, and exports the record.
- Dynamic watermarks
- Stamps the viewer email and the time across every page, so a forwarded screenshot points back to its source.
- AI assistance
- Vendor-listed help such as auto-filing, document summaries, search across files or drafted answers.
Set up the room in 6 steps.
- 1
Close the books cleanly
Make sure every month is closed and reconciled to bank statements before the room opens. Reviewers lose trust fast when months are still moving.
- 2
Export customer-level revenue
Pull revenue by customer and month from billing. Reviewers rebuild your ARR and retention from it, so your summary should match their result.
- 3
Define every metric
Write one page that defines ARR, churn, CAC and margin as you calculate them. Disagreements over definitions cause most finance follow-ups.
- 4
Check tax exposure
Review sales tax nexus across states and payroll registrations for remote staff. Unregistered states are a frequent finding.
- 5
Share spreadsheets with tracking
Keep models as live spreadsheets with watermarks and view tracking, and note which version is current in the file name.
- 6
Answer in writing
Answer finance questions in the Q&A with a link to the supporting file. The accounting firm will cite those answers in its report.
Common mistakes.
- Booking annual prepayments as revenue in the month cash arrives.
- ARR figures in the deck that cannot be rebuilt from the billing export.
- Ignoring state sales tax and payroll registrations for remote employees.
- Several versions of the model in the room with no clear current file.