Virtual data rooms (VDRs) allow you to make it easier and more secure to share important documents with other parties. Businesses across a range of industries, including life sciences and technology are using them to conduct due diligence, as well as other business-related events like M&A, capital raisings, audits and strategic reviews.

A VDR offers a number of advantages over physical storage. The files are accessible anywhere via the internet. They are also not subject to physical causes of damage like fire or floods and can be kept securely for as long as the company would like to keep them.

The most commonly used use for a VDR is to facilitate an M&A process, where many sensitive documents need to be reviewed by potential buyers. In M&A diligence this VDR permits businesses to share confidential documents such as business plans, financial documents and much more, without worrying about their security. Permissions can change dynamically and detailed logs of user activity can provide valuable information about the specific interests of each buyer.

To ensure the safety of online data, a virtual data room should be equipped with multiple layers of security that include physical and cloud security. A reliable VDR will regularly back up its servers in order to prevent data loss due to technical issues. It should also employ encryption methods such as digital watermarking, digital encryption and other features that discourage hackers from accessing files. It should also be easy for teams to migrate data from different platforms into the VDR and for compliance departments to keep access rights or revoke them as soon as users leave the company.