The most popular use case for data room technology is due diligence on an M&A deal, but a virtual data room is also beneficial in the management of legal documents including capital raising, regulatory risk management. The ability to create a secure online platform that is accessible to all parties allows for more efficient communication and collaboration.
A VDR unlike conventional file repositories provides the tools to limit roles and giving access to specific users. This adds another layer of security that standard tools for sharing files don’t provide. Premium VDR tools typically come with an on-call technical support team who can assist with any issues, or provide suggestions on how to optimize the use of the tool.
VDR features can help protect sensitive data by encrypting information both in transit and in rest. Permissions for users to access the system are also available, as are remote shred and a custom watermarking. Administrators can monitor activity and document downloading and viewing statistics, to identify any suspicious or unauthorised activity.
The ability to upload large amounts of files is another data room feature that is useful for M&A as is the option to design a customisable project interface and apply an image of the company’s logo or NDA. Document naming conventions, categorizing and ordering, indexing, and tags for documents can be set in addition to notifications preferences and two-factor authentication (if required). Redaction tools allow users of data rooms the ability to effectively and selectively delete sensitive documents.
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