A virtual data room (VDR) is a safe online environment that allows to share large amounts of confidential information outside of the corporate firewall. VDRs are used to facilitate due diligence for M&A transactions as well as bankruptcy, litigation and fundraising.
A VDR’s ease of use can determine the success or failure of the deal for all parties. If the system has a steep learning slope, it will be more difficult for participants to upload files to save them and manage them. This can slow the process and impede negotiations.
A VDR must be well-organized for efficient collaboration and easy access. The organization of documents into tags and folders allows users to locate information quickly and effectively. In addition, implementing features such as real-time commenting and annotations can increase the speed of discussions.
The most effective VDRs allow administrators to set 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. Additionally, the best VDRs are certified for security like 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 on a variety devices and platforms, reducing the amount of time switching between applications.
