While VDRs are commonly associated with M&A due diligence, they can also be used in any data sharing process that requires a business to share privileged information beyond its firewall. Whether it is sharing intellectual property in preparation for an IPO or soliciting funds from limited partners, VDRs can make any document sharing process more efficient by enhancing communication and automating tasks.
Contrary to their predecessors which required companies to deliver physical documents to reviewers Virtual data rooms allow users to access and review documentation on-demand. This is not just faster in the review process but also ensures confidential business documents are only accessible to authorized individuals. It also reduces the possibility of a security breach or compliancy violations.
For example for instance, the VDR can provide granular user activity tracking for all of the documents in the room including who accessed which document and at what time. This feature is beneficial when conducting security audits because it is able to prove that only a select group of people has viewed sensitive business documentation. It can also be useful in M&A due diligence since it provides a clearer picture of the level of interest and helps companies identify what documents are most attractive to bidders and investors.
When choosing a VDR, choose one that has customizable reports and real-time analytics to give administrators the insight they require. It should also provide seamless uploading of documents for multiple users and be simple to navigate on any device, but especially mobile devices.