A virtual dataroom is an application that offers secure, centrally-located storage of digital documents. This allows businesses to share data with internal and external stakeholders. Document version tracking and improved security are also possible.
Investment bankers utilize VDRs to conduct due diligence in M&A transactions. These transactions usually require multiple parties to look over large quantities of confidential documents. In order for a deal to be closed, they must be able upload and review the confidential documents quickly. They also need a secure storage space to store this sensitive data. A specially designed VDR makes this easy for them to manage with an organized folder structure and powerful controls for access to documents that can be instantly revoked if a deal does not go through.
VDRs are also useful tools for audits and regulatory data rooms filings that require transparency with internal stakeholders and external regulators. These projects typically require lengthy collaborations between teams in different locations and time zones. A VDR is designed to facilitate collaboration, tracking activity and communication with all stakeholders is easy using an VDR.
When selecting a service, look for features like drag-and drop functionality for bulk uploads of files, as well as support for the most popular extensions for files. It is also important to discover the degree of physical security the company offers with offsite backups, redundancy and fire protection. You should also check whether they are able to apply dynamic watermarks to viewed and printed documents or set up access restrictions for specific IP addresses.