Virtual data rooms (VDRs) are secure online environments that allow large volumes of confidential information to be shared outside of the firewall of a business. VDRs facilitate due diligence in M&A transactions and bankruptcy proceedings, litigation, fundraising, audits – just about any situation where outside parties have to look over sensitive company information.
A good VDR can be the difference between a successful or unsuccessful a deal based on the ease of utilize for all stakeholders. If the system has a steep learning curve and is difficult to master, it will be more difficult for users to upload files, save them, and manage them. This could slow progress and delay negotiations.
A well-organized data structure in a VDR is also essential to make it easy to access information and facilitate collaboration. A proper organization of documents in tags and folders will allow users to locate information quickly and effectively. Implementing features such as live annotations and commenting in real time can also increase the speed of discussions.
The most effective VDRs allow administrators to specify document permissions down to the file level. This includes features such as redaction, which blacks out areas of a file so that personally-identifiable information remains private. Furthermore, the most secure VDRs will be certified as secure such as ISO 27001, SOC 1/2/3 GDPR, and HIPAA. They will also be able to support various file formats, and be cross-platform compatible. This lets users work with a variety of platforms and devices, thus reducing the amount of time spent switching between different applications.
