A virtual data room is a tool that allows secure sharing of confidential documents with other collaborators. It eliminates the requirement for physical files to be sent via email or messaging platforms and is accessible by multiple users simultaneously. It also offers an enhanced security level with granular permissions and a robust encryption system that works during transport and when the file is not in use.
There are a variety of virtual data rooms, with some companies focusing on specific fields or types of projects. This allows them to offer a set of features that is suited to the requirements of that specific niche. VDRs can be used for a variety reasons such as M&A due-diligence. Some providers have special features that speed up the due-diligence process.
Modern VDRs index and search the entire text of the contents of the file. This decreases the amount of time that users have to spend searching for important documents, and helps organize the structure of folders. They also can automatically scan and convert PDFs as well as other common file formats into searchable documents, which helps accelerate due diligence. Other providers offer a variety of integrations that can automate the business process, such as signing NDAs and managing invoice approvals.
When selecting a provider make sure that it offers a slick user interface with a simple design that makes it simple for administrators and users to learn how to navigate the platform. You should also make sure that the provider hosts its servers in world-class data centers and has a thorough disaster recovery plan.