Considering the recent spike in cybercrime, it is more crucial than ever organizations to ensure data security and confidentiality when sharing documents. In this regard, many companies choose to use a virtual data room for crucial corporate transactions such as M&A deals and capital raising rounds, as in order to manage their data on a regular basis. When choosing a Data Room, it is crucial for companies to investigate the company’s experience and track record of providing secure online solutions for managing documents and confidential data.
Due diligence is one of the most frequently used uses of a data room. It requires the sell-side team to have a central place to review documents to respond to questions from potential investors. This helps ensure that only the right people review documents, and also prevents unauthorised parties from having access on sensitive information like business plans, financial forecasts as well as research results, patents and other documents. In addition to the standard features like secured connections multi-user access and password security, a digital data room could also include additional security measures such as watermarks that are visible when scanned or printed and the ability to specify NDAs for every project.
It is also crucial for a company to understand the way in which the cost of the digital data room varies in different situations and to ensure it has an established pricing structure with no hidden fees. The company should also take into consideration the tools each provider offers in relation to the cost they will pay. For instance some providers allow several user groups, while others provide additional services such as document translations and help.