A virtual data room (VDR) is a secure platform for sharing sensitive documents with granular security and a range of customizable access permissions. When compared to rudimentary data storage solutions that typically provide only downloading and viewing but the VDR can also provide search functionality as well as easy collaboration between multiple parties, and the ability alter access rights for every user.
Due diligence can be a lengthy procedure, requiring multiple parties to go through a large amount of information. This can lead to long drawn-out, lengthy deals or end the deal when the documentation isn’t comprehensive and properly prepared. A VDR provides a centralized location to store all the relevant information to be shared and reviewed by multiple parties, which helps eliminate delays caused by miscommunication or lack of documentation.
VDRs are beneficial for a number of other business purposes as well in the preparation of portfolio companies for an IPO or fundraising, which requires the organization to share financial records that are confidential with third party. They are extremely beneficial for investors as they arrange documents into logical subfolders that make it easier to navigate and grant access rights with a single click.
A virtual data room is an excellent method to share confidential intellectual property within the life sciences field with potential investors and partners. A VDR’s top data room detailed tracking of document activity allows users to know who has viewed what documents and for how long. This information is useful for checking if a particular project has been thoroughly explored, thus generating interest from investors who are interested in avoiding the risk of revealing confidential information to the wrong people.