How to Select a Data Room Service

A data room service is a virtual, secure environment that allows for the sharing of information during due diligence, mergers and acquisitions, financing, bankruptcy and other business transactions. The information shared during these processes may be sensitive or confidential and it is therefore essential to safeguard this data. With the data room, you can save time, money, and effort compared to emailing or printing documents. The selection of the best data room requires a bit of initial analysis to determine which features are most beneficial for you and your needs.

There are a variety of providers of data room services, each with a slightly different set features. Some concentrate on security, while others on communication and user experience, and still others offer the combination of both. Some of the most popular options are Firmex, VDRSimple, iDeals, Intralinks, and Merrill Datasite.

Most of the data rooms provide access rights that are granular to ensure privacy and ensure that users only access relevant material. Some also offer multiple factor authentication, as well as time and IP access restrictions to block the unauthorised downloading or use. Some even offer internal messaging which can reduce the necessity for external communication tools like email, and aid in reducing redundant communications.

Some companies offer additional services to speed up due diligence, including scanning and transcription of documents. These services are usually an additional cost, but it may be worth the investment for smaller businesses and transactions that are complex.