A Guide to Virtual Data Rooms

Virtual data rooms (VDRs) are secure platforms which facilitate the review of documents during M&A transactions. If you’re not familiar with the process this guide will introduce you to VDRs and explain their use and benefits, and help decide if they are the right choice for your company.

The selection of a VDR is a key element in implementing a successful due diligence plan. Begin by looking through internal reviews and third-party assessments to get a complete picture of each company’s effectiveness and ethics. You should look for a VDR that is easy to use and has a an extensive capabilities. For instance, some offer advanced features, such as custom watermarks, branding features, and NDAs that are automatically applied to all documents. Some allow users to protect files both during storage and transport, allowing administrators to specify specific permission settings for access control and digital rights management purposes.

Once you’ve made a decision to join the VDR, you can use the trial period to upload all your documents and organize them, as well as test the security features. Invite a few users to join the data room and then create groups of users to set permissions for different types of team members, like admins and users.

Ensure all users have up-to-date training on how to navigate the VDR and how to properly utilize collaboration features. Incorporate a well-organized folder structure as well as standardize the names of documents and names, and ensure clear access rights. Then, regularly review and update the structures to accommodate new projects and team members. Some VDRs have advanced features such as redaction which allows you to exclude certain areas of files to safeguard confidential information and avoid leaks.


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