A capital raising tool is one which simplifies the process of raising money for a company. It can be employed to manage the capital table of the company, grant equity grants, and conduct valuations for employees and investors. The best ones also have legal workflows that are integrated into the platform, as well as support for ESOPs and other financial transactions involving equity.

The process of raising capital is a huge undertaking for businesses and the best method to get your ducks in a row is to make sure that all of your documentation is up-to current and ready prior to time. This means having a solid executive summary including profit and loss statements, balance sheets and other financial documents to present to potential investors as part of your capital raise due diligence.

There are many ways a business can raise capital. This includes private debt and equity, crowd-funding and Small Business Administration (SBA) loans. The majority of these methods are the same, but some require more paperwork, based on how you raise funds.

The most commonly used form of capital raising comes from private investors such as venture capital, VC firms, as well as hedge funds. Prior to investing, many of these financing sources would like to review a company’s financial records. This includes a profit and losses statement as well as balance sheets, tax how to organize your data online returns, and bank statements. This is referred to as due diligence. It’s best to have a data room due diligence program like DealRoom or an alternative in place to make the process as efficient as it can be.