Whatever the case, whether it’s M&A audits, business or fundraising, legal matters or making preparations for an IPO, a data room is a secure means to share confidential information with other parties. Data integrity is ensured by the granular access rights that can be customized according to the roles, document or folder levels, and the activity within the room. The most reliable providers provide numerous security features, such as encryption, watermarks, as well as multi-layered servers protection.
The most popular use for the use of a data room is due diligence, where two parties go through business-critical documents in order to determine any possible risks or problems prior to making an agreement. This is best accomplished through a virtual room that lets both parties upload and read documents from a single location. A reliable data room solution has a structure that can be modified based on the specific requirements of a project or due diligence. It will also have an efficient task management tool that provides a clear overview of all reading and uploading tasks as well as who they have been assigned to.
As a result, it is much easier to follow-up on tasks and keep projects on schedule. Many data rooms come with a Questions and Answers module that allows discussion between the parties which speeds the negotiation process and removing the need to send emails back and forth. An excellent feature that many top solutions provide is a comprehensive set of reports detailing all user activity, ranging from the date that documents have been viewed to the time they were viewed and by whom.