Security of confidential information is essential during business processes and transactions. Virtual data rooms permit users to store and share private documents in a secure environment. Generally, they are used for due diligence in M&A deals however, they can be dataroomanalytics.net/advantages-and-disadvantages-of-buying-an-existing-business/ used for other purposes too.

The top VDRs offer a range of features to ensure documents are safely stored and shared during a deal or process. They could, for instance, include two-factor verification, which requires that not just the password is used, but also factual information and codes that are unique to each individual user. This helps reduce the risk of data breaches that are caused by compromised passwords. Many VDRs also provide granular access rights which can limit access to specific files. IP restriction is another feature that limits access to virtual data rooms to specific IP addresses. This stops sensitive data from being downloaded onto unauthorised devices, and can help keep information from being leaked.

Other features that are offered on certain VDRs include watermarking, which provides an unchangeable identifier on every document, and audit logs, that record all actions on the data room’s files. These can be used to identify who has been able to access or modify files, and they can also help in the investigation of data breach. Other features that are beneficial include secure spreadsheet viewing, which assures that data stored in Excel files can only be viewed by a specified users.

Check the certifications and standards of the data room to make sure that it provides the right level of security for your documents. The ideal situation is PCI DSS Level 1 ISO 9001 / ISO 27001 FIPS 140-2 MTCS Level 3 Some investment banks keep a list of approved vendors that offer data rooms that they are comfortable working. Choose a vendor who has these credentials and has a good reputation in the industry.