Virtual data rooms (VDRs) make it easier and safer to share important documents with third parties. Companies across many industries, including life sciences and tech are using them for due diligence and other business events such M&A capital raises, audits and strategic reviews.
A VDR provides a number of advantages over physical storage because the files are able to be accessed from any device through an internet connection. They are also not vulnerable to physical damages, such as flooding or fire and are able to be kept securely for as long as the company would like to keep them.
The most popular use for a VDR is to facilitate an M&A process, where many sensitive documents have to be reviewed by potential buyers. During M&A due diligence it is important to have a VDR allows companies to share confidential business plans, financial documents and more without having to be concerned about their security. Permissions are able to be changed in a dynamic manner, and the detailed logs of user activities provide important insights into the needs of each buyer.
A virtual data room must include multiple layers of protection including physical security as well as cloud security, to ensure the safety of data that is stored online. A reliable VDR will regularly backup its servers to safeguard against data loss due to technical issues. It should also utilize encryption techniques, digital watersmarking and other features to deter hackers from gaining access to files. It should be easy for compliance departments and teams to transfer data from different platforms to the VDR.