The Complete Guide to Virtual Data Rooms: The Three Most Popular Options

Thanks to virtual data room software, fundraising, investment portfolio management, initial public offerings, and cross-border acquisitions and mergers are much safer and faster now. Virtual data rooms have just rewritten the script for data management practices. Today, online data room software technology is a part of any size and kind of business.

How did data room technology become so famous in a short time? What made data room software a frontline data management solution? And most importantly, what can an electronic data room do for your business? You can find all the answers in this guide, starting with the basics of VDR technology.

What is virtual data room software?

Virtual data room software is an online data management tool that any business, company, nonprofit, government institute, and organization can use to store, share, and manage their business data.

In simple words, an electronic data room is an online, remotely accessible database with advanced collaboration tools as well.

Data rooms are cloud storage hosted by licensed or certified virtual data room providers. To be a certified vendor, complying with international and regional cyber security standards is mandatory. That is why VDR vendors are ISO 27081, ISO 27001, GDPR, SOC2, SSAE 16, and FINRA compliant.

What’s different in virtual data rooms is their advanced communication features. You can store/share documents, arrange online business meetings, create live polls, and chat with one or more users within the data room. One of the biggest attractions for virtual data room users is that they reduce administrative expenses to a great extent. In fact, virtual data room software can reduce your paper/printing expenses by up to 75%.

Many modern-day online data rooms have project management tools employed for managing large-scale business undertakings. The most common ones include M&As, joint ventures, strategic partnerships, bidding, and due diligence. You can read more about due diligence VDR solutions at: https://vdrsolutions.org.

Difference between virtual data rooms and data sharing platforms

Free data sharing tools and data room software can be differentiated on various grounds, but security is the biggest difference.

A standard or high-quality virtual data room has 256-bit data encryption. There are hardly any free tools with such strong encryption features. Moreover, data rooms encrypt files and the data in them, while free tools only encrypt files and not the data.

The VDR technology is mostly hosted by certified vendors, but some integrations with the most popular third-party tools are also possible. Free data sharing tools are usually not ISO certified, but they also offer third-party integrations.

Communication tools are the biggest difference between both. Any standard data room software has all the necessary tools for communication between employees, investors, managers, stakeholders, etc. That is why data rooms are used for board communications because they allow data sharing and have meeting management tools too. Unlike data room software, free data sharing platforms don’t offer any collaboration functionality, which makes them a less suitable choice for team work.

What is online data room used for: Data room use cases

Virtual data room technology is for anyone with secure data storage, sharing, and management needs. However, businesses also use it as a meeting management tool. The most common data room use cases include:

  • Data storage/management
  • Due diligence in mergers and acquisitions, IPOs, fundraising, joint ventures, real estate transactions, etc.
  • Board communications
  • Online meeting management
  • Litigation
  • Clinical trials
  • Investment portfolio management

The use of data room software has extended to numerous industries such as financial institutions, pharmaceutical companies, R&D firms, life sciences, private equity firms, nonprofits, oil, energy, government institutions, law firms, etc.

Top 3 most popular virtual data room providers

At this very moment, there are hundreds of data room services available in the market. However, the quality and security vary greatly. Here are some of the best virtual data room providers famous for different reasons.

1. iDeals virtual data rooms

iDeals is one of the oldest virtual data room service providers globally renowned for its second-to-none security and customer support services. iDeals is a top choice because it is similarly suitable for business teams, small businesses, companies, and enterprises. These data rooms support common mobile and desktop operating systems such as Android, iOS, Mac, Linux, and Windows.

2. DealRoom data rooms

DealRoom VDRs are particularly designed for the due diligence process, which is common in M&As, fundraising, and other similar projects. However, using these solutions for routine data management use can be expensive.

3. SecureDocs

SecureDocs is a highly affordable option for small and medium businesses who want to enjoy all major virtual data room benefits but at an economical cost. SecureDocs virtual data rooms are safe for data sharing and due diligence.

Other notable names include Digify, FirmRoom, CapLinked, Box, ShareVault, and Intralinks.

These data rooms are highly rated by actual consumers on trusted software review websites. However, it is highly recommended to compare virtual data rooms when selecting the most suitable solution for your business or personal use.

Final words

Data room software is a secure, easy-to-use, and remotely accessible online data management tool. It is an all-in-one platform for safe data sharing, online business meetings, and inter or intra-organizational communication. Consider using a virtual data room if you have never tried it before — and reap the numerous benefits for your business.

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Dibyashree Sharma

An NIT Rourkela Graduate in CS, Blogger, Android Geek, and a Tennis Fanatic. I have been writing about Android OS for Last 8 years.

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