Virtual Data Room Software is a secure online repository that permits storage and sharing of confidential documents and files. This includes financial records such as legal contracts, intellectual property documents, employee data and much more. VDRs are frequently used in the M&A process, particularly during due diligence, as well as for various other collaborations among business stakeholders like joint venture investments, executive communication between board members and patenting and licensing.
The primary benefit of the VDR is that it is accessible remotely and securely by authorized users via a web browser or dedicated agent applications. The data is protected by the file level permissions and advanced cryptography methods, which prevent sensitive information being compromised in an unauthorized way such as hacking. The VDR should be highly customizable and fully integrated with the company’s workflows and IT systems.
VDRs can be beneficial for all kinds of business transactions, but certain industries use them more heavily than others. Life science and technology companies, which have to safeguard their proprietary data, are among the most heavy users. However, virtually all businesses can benefit from an VDR for certain collaborations.
To ensure that the right VDR is selected for a specific business need it is essential to select one with a simple interface that is both familiar and intuitive for CFOs and entry-level accountants. It is also important to choose a vendor who offers a free demo and allows the user to customize it to ensure seamless integration with the company’s current technology stack.