Neil Patel

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Are you at the point where you are thinking about how to share information with investors?

Knowing how best to share information with investors can cause entrepreneurs a real headache. After all, the product designs, patents, and marketing materials you have developed are priceless resources for your business.

While you may be ethical, some people are not. 

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The Ultimate Guide To Pitch Decks

By gaining access to these materials, they may use your own business ideas against you in some capacity. Furthermore, how you share these materials with potential investors carries a security risk. Even when you do want to share the information, how can you do this safely?

In this article, I’m going to explore how to share information with investors in a way that protects your business and yet helps potential investors understand more about the entrepreneurial opportunity you’re offering. 

Due Diligence is Essential

Whether you’re an investor or a start-up founder, you should be entering into a reliable and robust form of due diligence. This process allows you to ensure, as best as possible, that the parties you are negotiating with are being forthright and honest about their capabilities. When thinking about how to share information with investors the due diligence is the part where everything falls into place around sharing info. 

It also protects you and your business from risks associated with new potential partners and their business operations.

During the due diligence process, you may be asked to share one of the following with a potential investor, with each being key to sharing proprietary information:

  • Business model and any business plans you have developed
  • Personal business track record
  • Financial details such as profit and burn rate
  • Team reputation
  • Detailed information about owned assets
  • Contractual obligations
  • Current and future risk/liabilities your business faces
  • Insurance agreements
  • Revenue streams and your supply chain information
  • The debt and share structure of your business
  • Trademarks and patents, both existing and pending
  • Your market research data
  • Details about exactly how your product/service works

When taking all these points into consideration, sharing all this information with an investor does carry some risk that this information could fall into the wrong hands. Throughout the pitching process, you will be sharing much of this information with several investors. Each time you do this, the risk of your information being accessed or misused increases.

For this reason, robust and safe procedures must be carried out to share any proprietary information about your business with investors with confidence. However, my recommendation is to avoid putting confidentiality agreements for just sharing exploratory documents such as the pitch deck. 

Remember that storytelling plays a key role in fundraising and you will need capital to scale things up. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.

Sharing Proprietary Information Securely

When you are thinking about how to share information with investors keep in mind that the best way currently to share proprietary information with an investor, is to do so digitally. In the past, handing out or sending sensitive information physically meant this could be easily copied or could fall into the wrong hands. The 21st century equivalent of this is being hacked.

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Also, I’d like to point out, as a follow up to the above concerning confidentiality agreements, that asking investors to sign non-disclosure agreements before they have committed to backing your idea, is a bad move. Doing so signals to the potential investor that you don’t trust them.

In any case, often an NDA agreement doesn’t offer you complete protection, as your ideas could probably be reverse engineered in some ways or incorporated into a competitor’s business operations or business model.

When you are thinking how to share information with investors and want to do it online, if you are sharing something digitally, it’s got to be done securely. 

While collaborative services like Dropbox, Trello and Google Drive are great for bringing people together to work on some project aspects, I highly recommend using a secure data room for your proprietary data.

Most cloud-based services like Dropbox do have an element of security, but it’s not really robust enough when sharing sensitive information. There are a number of services out there specifically designed for high security remote data viewing, using a secure data room. It’s best to use these rather than be tempted by other cloud services. 

A secure data room is usually a virtual server in a remote location with cutting edge security protocols. While collaborative websites like Trello focus on a wide range of services, data room companies focus entirely on providing a secure place to store digital information. 

There are many options out there, so shop around to see which ones work best for you, depending on your budget. Some examples include:

  • Secure Docs
  • Intralinks
  • IBM Security
  • Ideals

This doesn’t mean you shouldn’t use things like Dropbox and Google Drive for your business, it just means that you should use a more rigorous service when sharing proprietary information with investors, so you can be certain that no one else can access it.

How Should I Share Proprietary Information with Investors?

When wondering how to share information with investors, know that the key to sharing proprietary information is to know when to reveal critical details and when to hold off. I’d split this into five discrete stages. At each subsequent stage, you will be in a better position to reveal more about your business to an investor:

1) First Contact

When first contacting an investor, you shouldn’t reveal everything about your business in one overwhelming information dump. What you should do, is provide concise information about your business; enough to pique the interest of a potential investor. Focus really on the why before you dive into the what and the how.

Venture capitalists and successful angel investors see pitches all the time, so they don’t want a 50 page report on your business at this stage.

2) During a Pitch

When pitching, you’ll need to share some details about your product/service and how it works. You’ll also have to be clear about various trademarks and patents. However, you don’t need to share the intimate details of the technologies you are using for your product.

As I’ve outlined before, the best pitch structure contains concise, powerful information about your business’s financial prospects and market size.

3) Pitch Follow-Up

After your initial pitch, interested investors will follow-up with you. This is when they will ask for more details like the financial model.

At this stage, it’s up to you how much you share with them. You need to tread the thin line between revealing enough to make them more interested, but not everything because this is not a concrete offer. They are most likely to ask about production data, market research, and more detailed financial data here.’

4) Preliminary Offer

When an investor tells you they are seriously considering investing and want to know more, that’s when you should pull the curtain back further. Remember, however, without a term sheet, this is still not an official offer, so treat your information carefully.

5) Concrete Offer

If a concrete offer is made with a term sheet, then due diligence will be carried out. This is a critical part of how to share information with investors. This is when you should share any requested information with the potential investor. If you want to go ahead with an NDA this is really the stage where you would bring it in to seek some form of protection. 

In the video below I cover in detail how to share information with investors which you may find interesting.


Hello, everyone. This is Alejandro Cremades, and today we’re going to be talking about how to share information with investors. Sharing information with investors is a real headache for entrepreneurs. You really don’t know who is going to be seeing those materials or if they are going to be forwarded to someone else, and it’s a real headache to founders because you really want to keep them tight to your vest. But, essentially, you’re going to have to open the kimono somehow so that people gain access and understand and validate some of that information that you’re sharing during meetings. In today’s video, we’re going to be sharing exactly what you’re going to be sharing, how you’re going to be sharing it, and then also how you can protect yourself. So, with that being said, let’s get into it.

One of the last steps in the fundraising process is going to be the due diligence stage. At this stage, the investor wants to validate the claims that the entrepreneur has made during the conversations. When you are thinking about the due diligence, you should expect to be asked or requested for the following materials.

  • Business model and any business plans you have developed
  • Personal business track record
  • Financial details such as profit and burn rate
  • Team reputation
  • Detailed information about owned assets
  • Contractual obligations
  • Current and future risk and liabilities your business faces
  • Insurance agreements
  • Revenue streams and your supply chain information
  • The depth and structure of your business.
  • Trademarks and patents, both existing and pending
  • Your market research data
  • Details about exactly how your product and services work

Before you actually get to that due diligence process, they may request some of those pieces of information individually. I find that personally, I would not recommend having a Non-Disclosure Agreement in place before you enter the actual formal due diligence phase because you are adding more friction to the fundraising process. Fundraising is not about adding friction, but it’s about removing friction.

Unless it is clear that they’ve given you a term sheet, and they’re ready to move forward to the due diligence phase before the offering documents are signed, it means that you should not yet put a Non-Disclosure Agreement in place so that you can continue to move the fundraising process in a very smooth way.

In terms of sharing the information securely, especially when you get to that due diligence process, you want to make sure that you have a Non-Disclosure Agreement or a Confidentiality Agreement in place so that you can protect whatever information that you’re going to be sharing with that investor.

There are different ways and different tools that you can use that information, such as Google Drive, Dropbox, or maybe any other cloud-based application where you are sending that link to the investor, and you remain in control. I find that the worst that you can do is to add whatever documents and attachments to emails because the minute that you do that, that is the minute that you lose control over whatever materials that you’re sharing. 

By having all those materials in one single space on the cloud, you’re going to be able to remove access from that investor whenever you don’t want them to access those materials any longer. For that reason, a cloud-based application is the best way to go so that you remain in control of whatever information you’re going to be sharing.

When you are actually going through the fundraising process, there are going to be different stages that you are going to be encountering in terms of interactions with the investor. Every single interaction is going to require different pieces of information that you’re sharing all along the way. With that being said, we’re going to now break it down from the different stages and exactly what you’re actually sharing during those stages.

During the first contact with the investor, what you want to do is you want to pique the interest of the investor. You do not want to overwhelm them with information. At this point, maybe you can go into the why of why you got started with this business before you go into the what and the how.

Also, if you haven’t had that first meeting, that first contact via the introduction of someone, and that investor is asking for materials in advance of that discussion, you want to be very careful because you’re not sure what is driving the agenda. You don’t know if they’ve invested in a competitor or if maybe they’re not doing marketing intelligence type of surveying to capture that data. You’ve got to be very careful. What you could do is if you’re sending a pitch deck, remove the financials from that pitch deck so that you’re not adding sensitive information. 

The first contact is all about creating that attractiveness around your story, around your venture, so that they invite you to do a follow-on meeting or perhaps that proper, serious, and professional meeting so that you can explore whether or not there is a possibility of exploring something together with that investor.

During a pitch, exactly what you’re going to be sharing is how it works; you’re going to be talking about the product or the service, giving them a glimpse so that they get it. Here, you’re not going to be sharing much more than that. You may even do it on the narrative, on the phone, in person without the need of slides, or perhaps with some slides, but that’s essentially it.

On the pitch follow-up, you need to take it to the next level. Here, after your first interaction, you’re going to be following up with a thank-you note. In that thank you note, you’re going to be adding the pitch deck and then also the financial model so that they can review further and perhaps share it internally with some of their partners or with some of their friends in the event that they are angels or venture capital firms.

Here, they’re going to be reviewing the information in detail and putting that in contrast with whatever you shared during your previous meeting, and that is going to determine whether or not they’re going to move forward with a follow-up meeting.

When you get a preliminary offer, this is when you’re going to be pulling down the curtain. This could be either a verbal or maybe a commitment to make an investment. Perhaps they’re giving you a potential term sheet, and they have promised to really do that. 

Here, if they’re asking for whatever, you’ve just got to share it. You can use an NDA, a Confidentiality Agreement, or maybe wait until you actually have the term sheet that you’ve signed. But essentially here, you need to be prepared to go a little bit above and beyond to share information that could push that investor over the edge.

When there’s a concrete offer, here is where you’re really going all in, as I was mentioning earlier. At this point, you have it on the table; you’ve signed that term sheet; there’s clear alignment to move forward and getting a deal done. Here, you get the NDA or the Confidentiality Agreement, and you move forward toward that due diligence process and sharing all that information that you’re going to have at this point in a data room in let’s say a Google Drive or a Dropbox so that you get those people to actually verify whatever claims you’ve made and to move forward with an investment.

With that being said, I’d love to hear on the comment section what you’re up to and what has been that due diligence process or perhaps the process of sharing information with investors for you. Also, Like this video if you enjoyed this time, and then also subscribe to the channel so that you don’t miss out on all the videos that we’re rolling out every week.

Take a look, as well, at the fundraising training, which is the program where we help entrepreneurs from A to Z with everything related to fundraising. There you’ll find live Q&As, templates, agreements, a community of founders helping each other all over the world, and I find that you’ll really see tremendous value in it. Thank you so much for watching.


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Neil Patel

I hope you enjoy reading this blog post.

If you want help with your fundraising or acquisition, just book a call

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