A virtual data room (VDR) is a secure repository for sharing documents and information. It is used in M&A deals due diligence, fundraising and other high-risk transactions which require sharing sensitive information between the parties.
In the past physical data rooms were used to store data. They were locked in a central area that was monitored by a team of security to keep track of access. These rooms are expensive to maintain and are lacking many features which makes them a poor option for modern businesses.
Digital VDRs serve as an online repository that can be accessible by authorized users on demand. They also offer a range of security options that are industry-leading like encryption and two-factor authentication, as well as watermarking and audit logs. You can rest assured that your data won’t be compromised by malicious actions.
When selecting a VDR provider, you should examine their track record and previous experience in providing online document management solutions for private information. You should also think about how they are able to meet different industry compliance standards. For instance, HIPAA-certified companies ensure that protected health information is kept safe, while the GDPR- and CCPA-certified companies can help companies conform to European privacy laws and California consumer protection laws.
Google Drive, Dropbox and Email can be useful for sharing files, but aren’t the best choice for sensitive information that requires the highest level of privacy. The use of a reliable, reputable data room will help you streamline M&A transactions, due diligence processes, and other high-stakes business projects while keeping your confidential information safe and organized.
