A virtual data room (VDR) is a secure repository to share documents and other information. It is used in M&A deals due diligence, fundraising, and other high-risk activities that require sharing sensitive information between the parties.
In the past, physical data rooms were used for this purpose. They were locked in a central location that was monitored and required a security staff to keep track of access. However they are costly to maintain and do not have various features which make them a poor solution for modern-day companies.
Digital VDRs provide a central repository that is available on demand to authorized users. They also come with a variety of security features that are industry standard, including encryption, two-factor authentication, watermarking, and audit logs. This means that you can be confident that your data is safe from unauthorized access.
When selecting the right VDR, you should take a look at their track record and the experience of delivering online document-management solutions that protect confidential information. Consider how they support various industry compliance standards. HIPAA-certified companies ensure that health data is safely stored, and GDPR and CCPA certified providers can assist companies comply with European privacy laws, as well as California consumer protection laws.
A variety of tools, including Google Drive, Dropbox, and Email are great for everyday file sharing, but they’re not the ideal option for storing and sharing sensitive data that requires a high level of privacy. A reputable data room can aid in streamlined M&A deals, due diligence and other high-risk projects, while keeping your personal information protected and well-organized.