Virtual data room software (VDR) is an online repository that allows the safe exchange of information. Users can access and upload data on a 24/7 basis, even when they are working from home or the office. This means that there is no need to send sensitive data via email which can lead internal leaks. The best VDRs also have advanced security measures, such as watermarks, limited viewing modes and document expire, ensuring that data is safe from unauthorised access.
The most frequently used use case for virtual data rooms is M&A activity, especially in the tech industry, where companies often rely on acquisitions as their principal exit strategy or important milestone. In these instances it is necessary for deal participants to look over large amounts of material within very short timeframes. This is especially important when companies have offices in different time zones and have offices across the globe. Virtual deal rooms function as a central point of reference that allows attorneys, accountants as well as external regulators to review company documents in a quick, convenient and secure way.
Virtual data rooms are also used by the banking, biotech, and energy industries. The main reason is that the underlying business processes in these sectors are highly sensitive and require a high degree of security and efficient collaboration. The top VDR providers offer robust solutions for these processes that include specific features for compliance, diligence and litigation. They also offer templates and user interfaces that can be customized to meet the needs of this kind of project.