The Benefits of a Virtual Data Room Business

A Virtual Data Room Business (VDR) is an encrypted repository for sharing important documents with the capability to track and record information access. VDRs are used in a wide range of business and industry functions. They are particularly useful during the process of a deal, which often involves third parties having access to large amounts useful content of sensitive information. These third parties could be solicitors or employees who are authorized to work working on behalf of either the seller or buyer. It is usually difficult to communicate information via email or hard copies. A VDR online makes it easy to coordination of due diligence.

VDRs are frequently utilized by companies that are seeking capital, undergoing an IPO or merger and acquisition (M&A). During the phase of fundraising, a company may require sharing information with up to fifty investors per week. A Virtual Data Room helps to control this influx of third party access and information, while ensuring control over who has access to documents and data.

Investors will often ask for the creation of a VDR prior to releasing terms sheets, to ensure they have easy access to information about the company, in addition to any publicly available material they may find online. It is beneficial to use a VDR once the deal has been concluded to provide investors with key information such as financial performance and qualitative information about the company. Some companies offer their investors an overview of their KPIs that they can access in real-time.