What Is a Secure Data Room?
A secure dataroom is a solution that’s cloud-based that’s designed to keep and share sensitive business information. It provides restricted access. Virtual data rooms are the current equivalent of physical rooms in which hard copies were scrutinized during negotiations for buying and selling. They also provide advanced security features including encryption technology, as well as other advanced features.
Secure virtual data rooms are typically designed around the principles of personal storage and sharing services like Dropbox or Google Drive, but with much greater security. Information and documents are protected when they are transferred to the cloud, as they are shared in the virtual data room, and while they’re stored in the server. They’re therefore safer than other file sharing and storage tools, which depend on passwords or plugins to limit access to certain devices and locations.
In addition to basic accessibility (on any device and from wherever you are), a data room usually includes collaboration features, e.g. chat and team messaging, to improve the efficiency of due diligence procedures. They typically include audit trails of every activity performed by users so that breaches can be traced and traced back to their source.
The majority of data rooms are designed to aid due diligence in a merger or purchase deal. Both parties have access to the data room to conduct an in-depth analysis. However, they are becoming popular for other kinds of M&A activities, such as fundraising, restructuring and divestitures. They can also be used to share and examine documents within teams, with an added benefit of more robust encryption security as compared to traditional email.
