For many businesses, in a variety of industries, data ranks among some of their most important assets. In a globalized online world, data security is more important than ever. Due to a host of online threats and cybersecurity issues, companies can never be too careful when it comes to protecting information. Virtual data rooms can provide the security and convenience that businesses need. Virtual data rooms (VDRs) first originated in the financial industry in the early 2000s as file sharing and document sharing transitioned online. Today, as transactions such as real estate deals, mergers, and acquisitions become more digitized, companies need to secure online processes to handle sensitive data. In the past, physical data rooms were a common component of legal and contractual processes. This commonly comprised confidential information required for due diligence and compliance in a secure location. They also contained information that might be of interest to potential buyers, bidders, or parties to a contract. Let’s take a look at how virtual data rooms could help move all of your document sharing online while providing secure access to your company’s digital confidential data.
Virtual Data Rooms
As discussed, a virtual data room is a secure space for document and file sharing. Similar to dropbox service, also called virtual deal rooms, VDRs allow confidential data, and other files to be uploaded and then viewed by third parties to aid with business deals and transactions. VDRs can improve a company’s due diligence process and limit the amount of physical paperwork that transactions and processes can require. More than just due diligence processes and M&A transactions, companies such as Apple are using the rooms to protect information about intellectual property. Some other uses for VDRs are also fundraising and asset management. Data room providers spend a lot of time and energy to protect your information and provide privacy for your company’s confidential documents and secure files.
Virtual Data Room Security
Secure virtual data rooms are the best option for businesses to ensure that the electronic confidential information used in various processes or transactions remains under their full control, and safe, at all times. The success of business processes and deals routinely requires that numerous documents including sensitive information are shared with third parties beyond the corporate firewall. To do this, a company will require secure data rooms that deliver a balance of accessibility and control.
A virtual data room that is both simple to use and easy to navigate is what most companies are looking for. They will need users to be able to effortlessly upload, download, access, and review documents in a safe, organized and efficient manner. A VDR that takes the guesswork out of security and offers multiple features that prevent unwanted third parties from gaining access is the key. With a VDR, the administrator will have full control over the level of access. They will determine who sees information and when they can see it. Another advantage is that administrators can also track who has viewed which documents. Virtual data rooms offer a high level of security that is comparable to that which is seen in the banking industry. Once a user, such as a bidder, buyer, lawyer, or executive, has been granted access, they can only see and do what they are given permissions for.
VDRs can also provide features for companies that decrease the likelihood of human error. Management of users and groups, setting group-level permissions, and “view as” tools to verify what users will see, serve as emergency exit security measures. These security “spot checks” provide another layer of safeguards before any third party is allowed to enter the data room. Audit logs also offer the ability to track all activity within the data room and monitor who has viewed the information. Administrators can see how long documents were viewed, what interactions occurred with documents, and all of the parties that viewed the information.
When processes and transactions are on the line, and a successful outcome depends on sharing sensitive documents, virtual data rooms provide a secure platform for housing information. With the ease of use of a dropbox and the security of a bank, VDRs have become the most secure option for hosting a company’s digital valuable data.