Virtual data room services have emerged a few decades ago. Before VDRs entered the deal-making market businessmen had to utilize physical repositories in case they wanted to share certain documents with their partners, employees, investors, or any other stakeholders. Under the circumstances when no other options were available, a physical deal room seemed to be a great solution. However, today, PDRs are utilized mainly for those deals that require the exchange of tangible objects or product samples – the rest of the functions can be successfully fulfilled be virtual platforms.
Indeed, numerous online data room providers offer businessmen much more convenient option: instead of keeping corporate files in physical repositories they get a chance to store their documents in the virtual environment, namely – in the cloud. When a deal-maker decides to open a digital room he should keep in mind that the new venue for information storage and exchange has multiple advantageous features. To begin with, a VDR ensures secure file sharing: the room is usually equipped with multiple tools which ensure data protection – encryption of all the documents, regular check for viruses, strong firewalls, multi-level user authentication, watermarks, etc. Also, digital data room helps its owners to save a considerable amount of time and money: the room is easy to open and maintain. As the virtual deal room can be entered from any place on Earth at any moment, it is possible to cooperate with the other participants of the deal and to interact with them without interruptions.
Virtual Data Rooms differ from their land-based analogs significantly and have already proved they are more useful and convenient for deal-making.
What to Expect from a Decent Deal Room?
Secure document sharing, reduced expenses and the chance to accomplish the deal sooner are among the most obvious benefits inherent to any virtual data room. But VDRs have one more undeniable advantage that cannot be ignored – they are extremely convenient. Any virtual deal executed with the help of virtual platforms immediately becomes less cumbersome and irritating. Indeed, usually, the room is enhanced with multiple instruments and options that should make the life of all those involved in the project as painless as possible. Deal-making is not only about profit – it is also about humans, their communication, and relations: both sides of the deal are interested in meaningful and productive interaction. The latter becomes possible only in a case when no technical aspects bother deal participants and when they can focus on crucial points of the project.
Hence, VDRs are expected to ensure that the needs of the clients are met and fulfilled. Being customer-centric, virtual platforms offers the following benefits:
- Worldwide and 24/7 accessibility so that users can keep on working whenever and wherever they want;
- Interface available in multiple languages;
- Logical file system that can be navigated intuitively;
- Training upon request in a case the certain user has problems with getting used to operating within a virtual platform;
- Advanced tools that help the users to impose the relevant filters and to find the documents they need without any efforts;
- Advanced uploading instruments that give the room administrators an opportunity to update the VDR in a few clicks and share the latest information considering the project with the rest of the room visitors;
- Integration with software (e.g., Microsoft Office) that allows users to work with diverse formats of information and edit files directly via the platform;
- In-document linking or, in other words, the right to link documents to each other;
- 24/7 qualified customer support;
- Access via mobile applications so that users can keep on working even on-the-go;
- Instant notifications that inform users about new files, messages or comments and help them to react immediately to the news;
- Customization of the room which can be made consistent with corporate identity – specific colors and logos can be embedded, emails, documents, and reports can be branded, etc.;
- Possibility to utilize one room for many projects – the owner does not have to close the room when the initial project is over.
Setting up a virtual data room
Now that you’ve decided which virtual data room solution is best for your due diligence, there are certain steps to prepare yourself for using the VDR.
- Decide on a VDR supplier and a service plan. The payment plan for the best virtual data rooms comes in different packages. Once you divide what supplier works for you, you’ll need to choose your payment plan based on the size of the project and the features of the VDR.
- Consider interface branding. Like your website, your virtual data room needs to reflect your brand image and identity. Once the data room agreement is signed, the next phase is to begin to customize the data room and populate it with relevant links to your brand.
- Structure a data room. It’s important to structure the data room efficiently to make it easy for external collaborators to find important files. The structuring process allows you to arrange files alphabetically or according to the existing industry protocol. This way, important documents won’t get lost in the stream of other files.
- Upload files to the virtual data room. Your data room solution begins to serve its purpose after you’ve uploaded important files and documents in the right folders and subfolders. With these, you’re able to test the functionality of the system before inviting external users to the room.
- Adjust controls and limitations. Data rooms contain confidential documents, and VDRs allow them to protect them effectively using the right controls. Once you upload the files, set controls on each document depending on how accessible you need them to be to the due diligence team. You should also determine what features you’re restricting for each file — if the team will be able to print, download, or make changes to any of the documents.
- Train personnel to use the VDR. Some team members may not have experience using a VDR, you’ll want to train them to prevent a breach or loss of data. It’s important to train staff before inviting an external due diligence team.
- Start using. Once all of these steps are done, you can now proceed to the most important aspect — using it for due diligence.
Extra tips on installing a virtual data room
- Establish an NDA. Many VDRs allow positioning an NDA signing as a precondition to entering the online data storage. This is not an obligatory step in setting up a virtual room, but it still will do no harm.
- Think of creating several data rooms. Many virtual data rooms provide an ability to build up several separate cloud spaces. This is especially helpful when you are seeking fundraising opportunities and have a few potential investors.
- Make regular content updates. Your business will definitely go through different stages, and indicating that in a data room is important. This way, your potential bidders will always get up-to-date information.
- Allow read-only access. Traditional data rooms allow you to restrict users from editing, forwarding, or downloading your sensitive files. By implementing read-only rights, you secure yourself from possible data breaches and ensure full control of the data room activity.