In decades past, when a large organization needed a secure way to store and retrieve sensitive information or confidential documents, they had to rely on physical data rooms filled with file cabinets housing the appropriate files. When the digital age came and started changing business processes forever, organizations began to rely more on data warehouses. These were still physical locations, but they generally contained servers filled with digital copies of important information.
Today, more and more enterprises are starting to rely on virtual data rooms (VDRs), or “deal rooms,” to securely store and share confidential information and important documents. These data rooms are most commonly used during the due diligence process for major business deals, like mergers and acquisitions (M&A), but they may also be used to review initial public offerings (IPOs), large investments, or even fundraising goals.
Since the contents of a virtual data room are typically so valuable, you’ll want to make sure you have the most secure option available. Here are five of the biggest reasons why your enterprise should invest in secure VDR.
1. Digital rights management keeps truly secure documents.
When you work with the best virtual data room provider, you’ll have built-in DRM protecting all the sensitive information you upload. Large enterprises can’t afford to rely on traditional file-sharing options like Google Drive or Dropbox. There’s no way to know what users are doing with your files when you use such options, and you’re also taking a gamble on the personal security of anyone who downloads one of your files.
DRM gives you an extra layer of protection via encryption, and only approved users will receive the decryption keys to access the files. A great VDR will also give you the option to customize additional security features, like two-factor authentication, if you believe it’s needed.
2. You maintain total access control.
One of the most important reasons that you need a VDR is because it gives you the ability to control which group members can access which files. If you’re conducting an M&A deal, then all kinds of professionals will need to get involved, including accountants, attorneys, investment bankers, and more. If you’re having to upload legal documents as part of the deal, for example, you would probably want to limit access to those to the attorneys on either side.
Fortunately, it’s easy to upload documents and set individual access protocols for each one. Simply select the group members you want to have access to each document, and click “enable DRM” in your secure data room.
3. You don’t have to rely on outside plugins.
Another great advantage of a secure virtual data room is that group members will be able to view documents in the VDR dashboard with no need for additional plugins or readers. This helps speed up the workflow when reviewing documents, and it also protects you from any possible data breaches that other plugins could cause.
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4. You’ll have activity tracking capabilities throughout the process.
The best virtual data room providers will also equip you with the ability to track activity for each of your documents. You’ll be able to see every time a document is viewed, downloaded, or edited, and you can track who did it. This makes it easy to see which group members are really interested in big business deals like M&A deals or real estate transactions.
You’ll also be able to see if a user is having difficulty keeping pace with the rest of the document reviewers, so you can direct them toward the most important sections. Of course, activity tracking will also alert you if someone has access to files they shouldn’t.
5. You can completely revoke access at any time.
Speaking of users having access to things they shouldn’t, an online deal room also gives you the ability to rescind access from some or all users at any given time. Naturally, you’ll always want to do this at the end of a deal, but you might need to rescind access early in suspicious circumstances. Access is completely revoked, even for users who downloaded the files, so you’re the only one who’s able to hold onto your important documents.