While VDRs are commonly associated with M&A due diligence, they can also be utilized for every data sharing procedure which requires a company to share sensitive information beyond its firewall. When it comes to sharing intellectual property in preparation for an IPO or raising funds from limited partners, VDRs can aid in making any document sharing process easier by enhancing effective communications and automating tasks.

As opposed to their predecessors who required companies to mail physical documents to reviewers virtual data rooms allow users to access and browse documentation on-demand. While reviewing processes are quicker and more efficient, it also the key elements of virtual data room ensures that only authorized individuals can access confidential documents for business and eliminates the possibility of an incident of security or compliancy violation.

For example, A VDR can provide detailed user activity tracking for all of the documents in the room, including who accessed what document and when. This feature can be useful in security audits as it can prove only a small percentage of people have viewed documents for business. It is also useful in M&A due diligence as it helps to get a better understanding of interest levels, and helps companies gauge which documents are most appealing to bidders and investors.

When choosing the right VDR, look for one that allows for custom reporting and real-time analytics to provide administrators with the behind the information they require behind the scenes. It should also offer seamless uploading of documents for multiple users and be simple to use on any device, especially mobile devices.