While apps like Dropbox or Google Drive are fine for everyday sharing of files, when it comes to sensitive information that could be shared during an M&A process or IPO or IPO, data rooms offer much more advanced features. Unlike free file storage platforms which are not specifically set up to share files in a highly safe environment. They are able to provide advanced permission settings, auditing capabilities and watermarking that guarantees only authorized people can view and download the needed files.
A virtual data room allows both parties to carry out due diligence using a controlled workflow for every document. This ensures that sensitive information about business, like patents or financial performance, is only available to interested buyers. Any conversations are also kept on the platform. It also helps to prevent leaks and lowers the possibility of sensitive information being accessed by the improper hands.
Activity audit logs are another important aspect of a data room. They give a complete review of who accessed a document and at what time. This lets M&A teams to monitor interest levels and determine whether to continue negotiations or move on. Additionally, reports from the data room help to keep teams organized by providing a snapshot of the activities of the group (e.g. Who has logged in and who has viewed or edited what documents and when?
A virtual dataroom also allows users to quickly sift thousands of files by providing an efficient search engine. This includes full-text search, Optical Character Recognition, filtering by label, a variety of logical operators and much more. Furthermore, the ability to automatically index and number folders and documents makes organizing and finding massive amounts of data easy.