Virtual Data Room is an online file-sharing platform that allows businesses to securely share files for mission-critical tasks. The data shared is usually private information that has significant value and must be accessed only by approved individuals in a secure setting. VDR providers are able to serve an array of industries and provide features designed to meet the needs of every industry.
M&A transactions, for example, require a large volume of documents to be shared during due diligence with bidders. These documents need to be sorted and numbered, allowing multiple reviewers to quickly find the documents they are searching for. The VDR should also permit users to upload updated versions of documents rapidly and provide search functions to ensure that the due diligence process is carried out as planned.
A VDR is often used by law firms to communicate confidential documents with clients, legal teams as well as third parties involved in business and litigation. A VDR provides the highest level of security and protects against information leaks.
Private equity and funds rely on VDRs to securely share information between auditors, limited partners, and portfolio companies. They can make better investments, achieve anticipated synergies and close deals faster. The data rooms also facilitate communications between all important source stakeholders involved in a transaction, thereby making the whole process more efficient. Additionally, VDRs provide tools to record questions and their answers so that everyone involved is aware of what’s being discussed.