If a company has to share sensitive documents with other entities for high-risk business transactions, they need an easy way to do so without risking a data breach or committing a compliancy breach. In these situations a virtual data room can assist with all your needs for sharing documents.
A data room is a virtual location where you can store and organize documents for use by authorized persons during high-risk business transactions, like an M&A, IPO, or fundraising round. These rooms can also be used for other occasions in which documents must be secured from external users.
There are a variety of file-sharing apps with security features. However, a data room is more efficient and provides investors with a professional first impression. Find a provider with user-friendly permission settings including auditing, watermarking and short messaging features.
Investors review the data rooms of startups for information that can help them make an informed decision about whether to invest in the business. Making your data organized in a way that is easy to navigate and including all documentation required can speed up the due diligence process, which makes it more likely that potential investors will make the investment.
While some startups might be tempted by free online storage and file sharing software, these tools are not designed with the security requirements of data for business purposes in mind. It is essential to select a dataroom that has been approved by leaders in the security of information. Datasite, RR Donnelley and Intralinks are some of the most reliable data room providers.
