Recently, there has been significant development of digital technologies, which could not but be influenced by the global economy. In an era when large companies have almost completely abandoned paper workflow, digital solutions that help store and securely share confidential corporate information come to the fore. Such tools are virtual data rooms.
So, what is an online data room? It is a digital service that acts as a secure online repository and allows all authorized users to have the ability to precisely control who can use specific data. This is one of the priority functions of VDR technologies, which allows you to effectively use the tool to facilitate important financial transactions. This is especially true in large corporations and transactions related to mergers and acquisitions, fundraising, IPOs, and much more.
The global virtual data room market offers a lot of solutions that help to cope with huge volumes of both structured and unstructured information. Under these conditions, traditional methods of information management, analytical solutions, as well as relational database management mechanisms do not bring the desired result.
Below you can find out about the main features that VDR rooms come with. You will also get an insight into where VDR solutions are used, how to maximize the security of data and operations when using virtual data rooms.
Features to Pay Attention to When Choosing VDR Solution
If you decide to get an online data room software, you should pay attention to several aspects which directly impact the efficiency of your project. Scroll down to learn more about them.
Ease of use
The ideal VDR should be easy to install and manage. Users should learn its functionality in the shortest possible time and utilize it as efficiently as possible. The interface of the modern VDR solution should be simple, intuitive, and not overloaded with control buttons.
Service cost
As a rule, virtual data room providers have a tiered payment system depending on the package you purchase. The most common factor that affects pricing is the amount of information you can upload to storage (measured in megabytes). If you’re going to store mostly text files, you may choose an option that offers payment per MB of data. If you are dealing with large volumes of information, media files, and so on, then it is better to choose a resource that offers payment for the number of pages.
In addition, be aware that some providers may have hidden fees, for example, for 24/7 service.
Also, the price may differ depending on the number of users who can simultaneously use the resource.
Offered Level of Security
Security and confidentiality of information are the cornerstones of the successful functioning of any business.
When choosing dataroom providers, take into account the mechanism for protecting a specific solution from hacker attacks and potential data leakage. It is worth paying attention to tools that offer encryption using a 256-bit key, two-factor authentication, and support for global security certificates (for example, ISO 27001). During the selection, it is worth taking into account the independent user reviews and the reputation of the provider.
Where You Can Use Virtual Data Rooms?
Given the above, it is clear that datarooms can be used literally in all business spheres. However, there is a list of areas where virtual data room solutions are 100% must-have.
Private equity and venture capital
Firms that engage in private equity and venture capital investments are faced with a large volume of business transactions that are accompanied by the exchange of data with different parties. Often these are financial transactions that require maximum security and confidentiality.
Legal firms
Law firms share large amounts of data with clients, employees, and stakeholders. With the help of VDR, they can do it safely and as quickly as possible.
Investment activities of banks
With the help of VDRs, the process of closing a deal is accelerated as much as possible. Mergers and acquisitions require simple, safe, and effective due diligence.
How VDR Can Help Protect Corporate Data and Business Operations?
Each of the servers in the corporate network can be the target of a cyberattack. This can happen for several reasons, namely: the presence of open ports that are used to establish connections, and the lack of a proper level of monitoring user activity. Also, one of the reasons may be the lack of all the necessary patches.
Therefore, in order to form the most effective fight against cyber attacks, it is necessary to build a flexible and customizable security system. Such a system should provide a search for malware, unauthorized data exchange, analyze the degree of danger and the type of possible attack/intruder. In addition, the solution should automatically change the system according to the current security needs.
Below you can see the main measures that most modern virtual data room providers implement to ensure the security of data and business operations:
- use of multi-level access to data and two-factor authentication of users;
- changing access conditions: customizing resources for data recovery, changing and connecting new nodes to the cloud;
- constant monitoring of all virtual resources, the functioning of the cloud storage, and the building of detailed performance reports;
- control of identification and evaluation at the level of abstraction of a particular service (this may be the evaluation of bandwidth, user accounts, and so on);
- assessment of the situation and accounting of all incidents (for example, monitoring the Service Level Agreement according to the established security conditions;
- development and implementation of security policy.
Speaking of the ideal situation, the entire responsibility for the data that is uploaded to the data room lies with the user of the tool.
At the same time, the electronic data room provider is responsible for the slightest distortion or unauthorized use of corporate information.
Photo by Carlos Muza on Unsplash