A virtual dataroom (VDR) allows companies to secure store and share documents in the cloud. The majority of VDRs are equipped with robust encryption techniques and access control, forming digital fortresses to guard sensitive information from unauthorized entry. VDRs can help streamline processes, speed transactions and improve communication.
Some of the most common instances of a VDR are mergers and acquisitions. These are situations where parties exchange large amounts of documents during due diligence prior making a major deal. VDRs can make the process of M&A quicker and more cost-effective by removing the need to mail physical documents or travel to meetings.
VDRs are also useful for strategic partnerships, where parties work together to create new products or expand an existing business. It can be challenging for partners to access data without divulging sensitive information or triggering violations of compliance.
Security is the main aspect to consider when selecting a VDR, whether it’s to be used for due diligence, M&A or internal collaboration. Modern VDRs are equipped with multi-factor authentication, advanced encryption both in transit and at rest, audit logs and other security measures that reduce the risk. They also provide features like watermarking disabled print and blind viewing to guard the privacy. This ensures that only authorized users are able to access the document and shows a commitment towards integrity of data. The best VDRs provide statistics on user and file activity that administrators can access to verify the accuracy of.