To cope with harsh competition and make the way to the top businesses implement many modern technologies in their workflows. They use task and progress tracking tool, instruments to boost the teamwork and external communication, and other programs for business.
One of such technologies is data room software. It became rather vital for modern companies that want to keep their documents safe and exchange information with third-parties easily. But first of all, let’s the data room definition.
Virtual data rooms are platforms that allow uploading and storing files in the secure cloud, work with documents on a daily basis, and share them with others when needed. This technology is used for due diligence, Mergers and Acquisitions, bankruptcy, seasonal partnership, and many more other purposes. A high-quality data room supplies the company with all the necessary tools for safe and efficient work that involves sensitive corporate information.
An electronic data room is extremely straightforward to implement in the work process. Most providers offer two options – deployment on-premise or in the cloud. The second option is simpler since the business won’t have to do anything to get access to the software. Just sign an agreement with a data room services provider, and then your vendor will take care of everything. If the platform is deployed on-premise, it will take a bit more time. However, the client won’t have to struggle with the installation – the vendor will do everything for them.
Of course, some not very tech-savvy users might face any difficulties trying to get their hands on the data room. But that’s not an issue – the best virtual data room providers offer 24/7 access to the support team that will help users with any problem they have. Specialists will guide you through every process you experience difficulties with and help you solve the issues you face.
Moreover, most providers offer live trainings and a dedicated project manager. The first feature will be great for those who struggle to understand how to use their virtual data room on its maximum capacity to get the most out of this technology. And the project manager will take care of the technical side of the deal so that you can focus on work, not on the software.
Therefore, even though virtual data rooms might sound cumbersome and somewhat scary, you have nothing to worry about. Your provider will always have your back.
How does data room work?
Now when we figured out what is a virtual data room, let’s talk about its features to understand how it works. So, the primary purpose of an online data room is to provide companies with reliable and convenient storage for their files. That’s why you will start by uploading your business documents to the deal room. They will be stored in the online repository that is protected from hackers by the strongest 256-bit encryption.
Also, the data room service usually has two-factor authentication. It means that users are required to enter some more data than login information to enter the repository. It can be a code sent via SMS or email upon logging in or other details that can prove the user’s identity. Vendors often offer many options for two-factor authentication.
Once your files are in the virtual repository, you can invite all your team members to the data room. Note that you can decide the level of access users have. It’s up to you who can only view the files, and who can edit, comment, and even share them. This feature serves as an additional layer of protection. You can give more rights only to those you trust.
When all your team is in the data room, you can ask everyone to review the uploaded files, check if they’re structured well and add missed documents. At this point, you want to make sure everything is ready for the upcoming deal. Also, at this stage, you should use another security tool – watermarks. Apply them to all your documents to protect them from unauthorized use.
If you feel like everything is prepared for the deal, you can invite third-parties to the virtual data room. Again, use different levels of access and play with them. For example, you should allow third-parties only to view files at the beginning of the deal. Later you can extend their rights if needed. Set an expiry date when giving rights to third-parties. It will protect you in case you forget to cut access after the deal is over.
Virtual data rooms accelerate and simplify deals for both sides. Third-parties will receive notifications when a new file is uploaded, or an existing one is changed. And the business can build efficient communication through comments on documents and a Q&A section where third-parties can get answers to their questions. By the way, we advise you to set up a Q&A section in advance, filling it up with answers to frequently asked questions.