Selecting a Virtual Data Room (VDR) and Data Security
Virtual deal rooms are standard software that can be used to share sensitive data as an alternative to the physical data room. These platforms are used to assist due diligence in mergers and acquisitions, as well as fundraising and IPOs. The success of this industry, however, depends on effective online security protocols. Cyber-attacks and data breaches can damage a company’s reputation, and also their relations with investors and customers.
One of the most important things to take into consideration when choosing a VDR is its security features. Look for a platform that has granular permission settings and multiple layers of authentication (e.g. two-factor authentication, single sign-on), and IP restriction to safeguard your confidential documents from being accessed by unauthorized devices. Ideally, the VDR should also incorporate digital rights management (DRM) policies that can be applied to specific documents. This will stop unauthorized users from copying and downloading data.
Go to the security page on their sites when you are considering VDRs. This will give you an idea of how the company takes security seriously. This will also inform you if the company has a dedicated security staff.
A VDR that allows for separate workspaces is another important aspect to take into consideration. This feature is crucial to stop projects from merging or divulging confidential information. It is also important to ensure that all projects have distinct names so that they can be distinguished from each other in the VDR.
