What Is a Virtual Data Room?


A virtual dataroom (VDR) is an application designed to secure document sharing and due diligence. This is different from the popular file-sharing services such as Dropbox or Google Drive that aren’t designed for business-related use, which requires greater security and compliance.

M&A: If a company is considering an acquisition or requires sharing sensitive information with potential buyers in some other way, VDRs are a great tool to track the activity and allow access. A VDR with robust activity tracking lets administrators observe, for instance, who has accessed files and the time they were accessed. This helps to ensure that no one has opened confidential documents without authorization. In addition, if a deal does not close, the capability to revoke access immediately is extremely valuable.

Private Equity & Venture Capital – The process of acquiring capital usually requires multiple rounds of sophisticated investors. A Click This Link VDR online enables companies to securely transfer financial documents and records, while keeping the information under control.

A VDR also supports electronic signature of contracts as well as other forms of documentation. This eliminates the need for draft documents to be exchanged via email or using third-party eSign service, which could create security dangers. Additionally, the majority of modern VDRs offer the use of granular security settings for files and folders and can use real-time vector watermarking and classification labels as well as permissions to block access by anyone who is not authorized. They also can generate reports and analytics to help administrators keep track of data activity.

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