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A secure virtual dataroom (also called electronic data room or online due diligence platform or VDR) allows companies to securely and safely share critical documents online with other parties in a controlled environment. In transactions like M&As and fundraising, real estate deals and IPOs the documents shared contain sensitive information. They need to be protected from cyber threats.
A VDR provides a wide range of security and control features, compared to service providers that provide basic upload, storage, and download capabilities. These can present security risks. Examples include granular access rights for documents, limitations on viewing, printing and downloading, dynamic watermarking, and two-factor authentication. Also, a virtual storage room is always backed up and inspected for integrity so files can’t be accidentally deleted.
VDR providers help businesses with complex transactions like M&A due diligence and help them become more efficient by providing collaborative tools that are powerful. For instance the virtual data room has a Q&A area where internal and external stakeholders can communicate. This feature lets you reduce time and effort by eliminating the need for meetings. It makes it easier to keep track of document changes.
The most reliable VDRs also come with robust physical security measures, including offsite data backups along with fire protection and biometric access. They have a business continuity plan and perform regular penetration testing to avoid data loss. Furthermore, they employ multiple layers of protection against ransomware and other forms of cyber attacks. They also have disaster recovery systems which include data center recovery tests and repeated failover capabilities. FirmRoom, for example, protects customer data and servers every day, making sure that files are never lost.