What Is a Virtual Data Room?

Virtual Data Rooms (VDRs) are software platforms that allow businesses to keep and share sensitive documents in a secure setting. It’s used to conduct due diligence in mergers and acquisitions, as well as litigation and financial transactions.

The VDR market is extremely scattered with vendors offering a variety of features and costs. The most reliable providers have an intuitive user interface and support staff that can speak multiple languages. They also have a comprehensive analytics function that provides behind-the-scenes intelligence about how documents are used.

Some data rooms are designed to specific industries. The life science sector for instance requires storing and sharing documents that contain medical and intellectual property data. Audits and litigation require the sharing of documents with clients. Many providers offer built-in capabilities for these processes, for instance, redaction (blacking out portions of documents that contain personally identifiable information). The industry of immovable property needs to communicate contracts to contractors to help with building projects. Certain vendors provide built-in features for this, like the ability to share blueprints or other important documents immediately with subcontractors via a VDR.

When you are evaluating options for a data room consider requesting a free trial and look at how easy it is to use. A VDR that is difficult to use will not be efficient, so make sure you test all features before you commit. Also, look into the uptime and reliability of the VDR. A reliable VDR important source about in depth information about the data room should be available and available at all times, with no interruptions.