Virtual data rooms are one of the safest data repositories in the world right now. You can store your personal or work-related documents in a virtual data room and retrieve them whenever you want. But do you know that data room software is much more than an online data storage platform?
Online data room software is not just a repository; it is a complete data management solution that automates multiple processes in your business. Here is a guide on how virtual data rooms work and what they are used for.
What are virtual data rooms?
A virtual or electronic data room is a cloud-based virtual data storage platform for businesses and professionals to store, share, or manage their important as well as regularly used documents.
Apart from that, the business world uses VDRs as collaboration or closed communication platforms. That means multiple users can be added to the data room, and communication can take place within the VDR.
Virtual data room software is a great virtual platform to stay connected to your clients, investors, stakeholders, legal or financial advisors, and business partners. Modern corporations are using electronic data rooms for conducting complex and time-consuming business transactions.
How do virtual data rooms work—common data room uses
From the discussion above, it is evident that virtual data rooms can help in the way you want. That is why businesses and professionals use them as per their needs. Here are some examples;
1. As a data storage tool
Safe and threat-free data storage is one of the most common benefits of data rooms. It is also one of the biggest selling points of virtual data rooms—safe data storage. Companies, professionals, organizations, and data-oriented businesses like marketing firms, lawyers, and pharmaceutical companies use data room software to store their business data in the safest possible manner. That’s because the success of these firms is based on the data they have. But why do businesses prefer data rooms?
VDRs employ some of the strictest security measures, such as;
- Strong data encryption for storing or sharing data in encrypted form. Even the data room vendors cannot access your data.
- Two-step verification to stop hackers or unauthorized users from entering VDRs. An authorized user gets through after using a confidential password and a code (generated every time a user logs in).
- “Fence view” mode is a feature provided by some of the best virtual data room providers in the market. Once you activate this mode on any document, it can be photographed, scanned, or screenshot. Fence View mode is very effective when pharma companies share highly confidential data with external parties.
- Document permission settings allow the management to limit the access of different users as per their roles. As a data room administrator, you can restrict any user from accessing a document, file, or even a folder. It means that even if a hacker gets through (which is very improbable)by faking an identity, it cannot access restricted sections or files of the VDR
- The remote purging feature helps you remove any recognized device and the VDR data in it to prevent data leaks in case a device is stolen or lost.
Pro tip: whenever you compare virtual data rooms for your business, make sure the vendor you choose has the features mentioned above. Never compromise on the security of the VDR.
2. For safe communication and data sharing
Gone are those days when you had to rely on emails and Dropbox to share data with your colleagues, clients, associates, partners, or investors. In fact, these platforms allow a limited number of file sharing.
Vdr software allows you to share hundreds of files with different users at once. You can also delete an accidentally sent file or revoke document access anytime; this feature is certainly not available in email service.
Moreover, depending on the data room services you use, you can add 100 (or more than that) users to the VDR. You can arrange online meetings with them (both audio and video), work on shareable documents, chat privately or in group form, create polls for voting, and annotate documents.
3. To simplify and streamline the due diligence process
Due diligence is a crucial part of any impactful business transaction, such as fundraising, acquisitions, mergers, and real estate transactions. The due diligence involves a thorough verification and analysis of vital business documents that may include audited and unaudited financial statements, licenses to conduct business, articles of associations, tax records, etc.
Virtual data rooms connect all parties involved in these transactions and allow them to share documents, conduct meetings or live Q&A sessions, and provide AI-based insights to make more informed decisions.
Summing it up
Virtual data rooms facilitate complex transactions and allow businesses to safely share data and communicate in real-time. Apart from that, they provide maximum security and remote accessibility to your business data. VDRs are user-intuitive, easy to use, and very cost-effective. Most importantly, you can unsubscribe whenever you want.
You can visit this website about data rooms to explore more about them.