When you’re in business, sharing documentation with clients or investors, partners, or clients can be essential. It’s essential to safeguard your documents and communications. You’ll want to choose an online dataroom for your business that has the security features you require such as 24/7 access to authorized users and two-factor authentication, timed access expiration; multiple permission levels; and IP address-based access restrictions. Review the certifications of the service provider to ensure they are compliant with the highest security standards such as SOC 1, SOC 2, ISO 27001, and HIPAA.
VDRs are commonly used in M&A transactions in which buyers must go through large volumes of confidential documents before closing a deal. The usual procedure was for buyers (often site web on an airplane) to travel to a secure area and examine the hard copies. It took days to complete and increased the likelihood that the deal could fail due to delays or other issues.
VDRs allow confidential documents to be viewed from any place in the world, which improves speed and competition among buyers. This is particularly important when dealing with companies working in the field of life sciences which require sharing details on everything from HIPAA compliance and clinical trials to licensing and patenting IP.
Virtual data rooms can also be used for fundraising, IPOs and corporate finance such as insolvency, mergers & acquisitions, real estate transactions and asset sales, as well as litigation files. It’s easy to understand why so many companies switch to VDR providers.