A virtual dataroom (VDR) provides a secure way to share sensitive documents. It offers high-level security with access permissions that can be customized. In contrast to basic data storage solutions that usually allow only viewing and downloading the documents, the VDR can also offer search capabilities and easy collaboration between several parties and the ability to alter access rights for each user.
During M&A deals due diligence can require a lot of information to be reviewed by multiple parties. It can cause long and drawn-out deals or even the demise of the deal in the event that the documentation isn’t fully and correctly prepared. A VDR is a central place for all relevant information to be reviewed and shared by various parties, thereby avoiding delays caused by miscommunication or lack of documentation.
VDRs can be utilized for a range of business purposes, including preparing portfolio companies for public listing or for fundraising, in which the company must share confidential financial documents with other parties. The ability to organize documents into logical folders that facilitate navigation and grant access rights in a single click make these tools very practical for investors.
A virtual data room is an excellent way to share confidential intellectual property in the life sciences industry to potential investors and partners. With the aid of document activity tracking that is granular, a VDR allows users to track exactly who has viewed which documents and for the length of time. This data can be useful in determining if a particular project is sufficiently explored and is attracting interest from potential investors, and could assist in avoiding divulging confidential information to wrong people.