When businesses collaborate with partners to develop products, construct structures or offer services contracts, data, and documents are typically shared. Virtual data rooms enable companies to securely share this information, without exposing themselves to possible breaches or violating the rules of compliance. They also make the information easy to find, review and redact for all parties.
M&A due diligence is among the most common uses for VDRs however there are other instances as well. Private equity firms and funds utilize VDRs to share portfolio information including tax information, fund documents with investors. Investment banks can make use of them to help the sell-side and buy-side in a financial transaction with document preparation, due diligence, and contract review.
During due diligence, the integrity of the VDR is crucial to the success of the transaction. If you’re sharing a VDR to facilitate M&A or a capital raise or any other deal, make sure you choose a service that has proven reliability in performance and support. Ask your vendor for downtime and uptime data and compare them to other different providers.
Be sure to consider the quality of the experience. Look for a vendor that offers easy-to-use features, such as drag and drop for bulk uploads of files as well as at-a-glance reports and virtual data room custom templates for internal meetings. Be sure that the customer service representatives of the vendor are familiar with your business and can help with processes similar to yours. This way, they can provide speedy, efficient and thorough support throughout the process.