A virtual dataroom (VDR) provides the security of sharing sensitive documents. It provides granular security with customizable access rights. When compared to rudimentary storage options for data that generally offer only viewing and downloading the documents, a VDR can also provide search capabilities, easy collaboration between multiple parties, and the ability alter access rights for each user.
In M&A deals, the due diligence process can require a lot of data to be reviewed by multiple parties. This could lead to lengthy drawn-out, lengthy deals or make the deal unworkable in the event that the documentation isn’t completed and properly prepared. A VDR allows all relevant information to be shared, reviewed and accessed by multiple parties in one central location. This reduces the time it takes due to miscommunications or missing documentation.
VDRs are useful for many different business reasons too for preparing portfolio companies for an IPO or fundraising which requires an organization to share confidential financial information with third parties. The ability to arrange documents into logical folders that facilitate navigation and to grant access rights with a single click makes these tools practical for investors.
A virtual data room is a great method to share confidential intellectual property in the life sciences industry to potential investors and partners. A VDR’s detailed tracking of document activity allows users to know who has visited what documents and for how long. This data can be useful in determining whether a plan is adequately explored and is attracting interest from potential investors. It could also aid in avoiding the risk of revealing proprietary information to the wrong people.