If a company requires external individuals to review its information, whether for due diligence or collaboration, it can be challenging to share sensitive information without risking a breach or committing a violation of compliancy. Virtual data rooms can automate and simplify processes to help businesses complete a variety of business events.
Mergers and acquisitions are among the most frequently used VDRs for startups, but businesses in any industry can benefit from a user-friendly and simple platform that consolidates documents rather than emailing documents back and back and forth. If you’re trying to raise funds from investors or prepare for an IPO, a virtual data room can make the process easier and help stakeholders find the information they require in a systematic manner that cuts down on the chaos of communication.
A good VDR should also have granular document permissions to limit access to specific folders or documents. Many providers offer comprehensive log-in and reporting features that track user activities, including who viewed which documents and when. A robust search function as well as a well-organized folder structure helps users navigate through the information.
Another important aspect is the ability to design custom document views for users based on their role and responsibilities. By granting specific viewing rights, you can ensure that only the necessary documents are reviewed and prevent miscommunications and lost productivity. Many providers also offer drag-and-drop functionality that makes it simple to upload and organize data.