Virtual data room is a cloud-based secure file storage that is protected by numerous security features including user access control and data access control. During the deal, documents and other deal-related data can be examined by parties in real time, without the need to use potentially unsafe email or public file sharing. Virtual data rooms such as iDeals use encryption protocols to keep confidential documents safe during transit as well as storage. Advanced vdr services also user virus and malware protection on all files incoming to the data room.
Unlike common consumer-grade file storage platforms data room has the following distinct differences:
- User control: each user or user group is assigned a certain number of restrictions or permissions depending on their role. For example, some users can only get access to certain topics, while other can be permitted only to view documents but not download or copy them. These permissions can be mixed and matched depending on the unique business needs. Two-factor identification and IP restriction further limit the chance of unwarranted actions with sensitive data.
- Data control: documents and other files in the deal room are protected by multiple security layers: custom watermarks, restricted view functions, post-data access retrieval which allows a data room owner to destroy the file after a certain period of time even on a remote computer. Furthermore, the data room offers complete audit trails to examine user behavior while inside the data room and full logs of user activity.
- Customization: virtual data rooms can be customized with the company’s corporate colors and logo.
- Communication tools: virtual data rooms users can ask questions and post questions to each other regarding the data room content inside the data room without the use of email or phone. Check the virtual data room comparison to see if this feature is offered.
These days, knowing that your confidential data is kept secure is simply priceless, not only from a business perspective but also to meet various international and local compliance and possible audit requirements. That’s why data room software providers, such as iDeals data rooms, work to add more and more security features to their offerings.
How Virtual Data Room (VDR) Works
The first step in setting up the virtual data room is to choose a provider using virtual data room comparison sites as well as virtual data room reviews. Then the chosen provider should receive a complete set of instructions how the data room will be used. For this, the future data room owner has to outline the approximate number of documents to be uploaded to the VDR, as well as an approximate number of parties and users who will have access to it. To accurately access client’s needs, data room providers also need to know for which period the data room should be used. While M&A deals, as well as fundraising proceedings, normally take from 3 to 6 months, if a data room is going to be used for storage of confidential corporate information the duration of use period may be indefinite. Finding the provider with best price option is easier with virtual data room reviews.
When all the required information has been collected, a contract is signed. Some secure data room providers recommend to start preparing documents for the data room upload at this stage, so the owner can start uploading documents immediately after the contract signing to use the vdr more effectively. When the standard services contract has been signed, outlining all details and responsibilities of parties, secure data room can be populated with documents and folders.
At this stage, the data room owner compiles all documents requires the deal and uploads them to the data room individually or in bulk. Better data rooms have easy-to-use file uploading tools such as drag-and-drop upload or bulk upload. Documents are dynamically indexed and arranged into folders according to the deal structure. Most often, the data room owner will have their own set of file naming requirements to create a streamlined, concise structure that will be easy to navigate. Naming can be alphabetical, using numbers, or hybrid. When it comes to the file size, it rarely matters since the data room is not charging its fees depending on the bandwidth used.
Now secure data room owner should send out invitations to the future users of the room and assign each of them permissions which areas of the room they are allowed to view and which actions with documents they can perform. Some data room services users will be permitted only to view documents and some to download them. The deal owner can also respond to queries regarding the data room content in a Q&A tool and monitor the data room use in detailed reports. When the deal is completed, the owner receives a copy of the data room content and full audit trail on a flash drive.
Modern data rooms are designed to satisfy the secure data sharing needs of diverse corporates working globally, as you can see from virtual data room reviews. The data room can be accessed using any device working on any platform, without the compromise for security or ease of use.