Data for a business is like water for life, Charlie Chaplin for comedy, and Maradona for football. Any modern business formulates all its strategies (at functional, structural, or departmental level) based on information. So it is obvious that “data” is like the backbone for any business. Most importantly, if it falls into the wrong hands, such as your competitors, you can lose your competitive advantage.
Before you start looking for data safety options, let us tell you about one of the most reliable and safest solutions, such as virtual data rooms. Data room software has been a rising trend in the business fraternity for over a decade now. What prompted businesses to use virtual data rooms are the massive data leaks in various global organizations such as Yahoo, where more than 1 billion user accounts were affected by security breaches.
So what is a virtual data room? How can it protect your business? What are the benefits of an electronic data room? Let’s find out!
What is a Virtual Data Room?
A virtual data room, often termed an electronic data room, is a cloud-based online storage space where you can store and share your business data.
What differentiates online data room software from other data storage facilities is its imperishable security. Virtual data rooms are not just simple data repositories; they have certified storage spaces where your business data is kept safe from any type of threats.
Data Room Security
Most of the data room services follow a multi-faceted and comprehensive approach to data security. When different layers of security are combined, they make a strong barrier against data threats or risks. Here are some security features in virtual data rooms that make them a safe haven for your business data:
- Data rooms guarantee non-stop data backup with 99.9% uptime.
- Best virtual data rooms always have data security certifications under their names. These certifications may include FINRA, SOC2, ISO 27001, ISO 9001, etc.
- Modern data rooms commonly employ 256-Bit AES data encryption.
- Secure data rooms also use various encryption methods, multi-factor authentication, dedicated private cloud servers, digital watermarking, and more.
Benefits of Virtual Data Rooms for your Business
Data Security: Safe Data Storage
We cannot emphasize enough how good virtual data rooms are when it comes to storing your business data safely. Online data room software makes sure you can store and share your business data in a very safe and secure environment.
It is virtually impossible to break into a data room because of the two-factor authorization method. The hacker cannot get in just by stealing the password. Moreover, the user will be instantly informed about any attempt to log in to the data room with their credentials. Also, virtual data rooms allow the users to share data in encrypted form.
Moreover, some of the best virtual data rooms have the self-destructing document feature. With this feature, you can set restrictions on how many times a document can be accessed by the recipients. This feature is very effective for dealing with deal documents.
Customized Access & Transparency
Virtual data rooms bring more transparency to your business. For example, the data room administration can monitor data room activities. They can see who accessed what and when; administration can keep an eye on who accessed the data room, opened or edited a file, etc. Audit logs ensure your administration gets every minute detail about all the activities in the data room.
Furthermore, virtual data rooms allow you to set customized access restrictions. That means, if you don’t want any specific user to access or edit any document, you can easily set restrictions. Similarly, the administration can set limitations on downloading, editing, copying, or printing any document(s). This feature is very useful when presenting data to potential buyers, external auditors, etc.
You may have to upload hundreds and thousands of files to your data room daily. Are these files scanned for viruses? If yes, great. Even if they are not checked for viruses, fret not because virtual data rooms automatically scan all the uploaded documents for viruses or similar threats. Some of the best virtual data rooms would not even allow you to upload a defective file.
Simplified Due Diligence
Data rooms are a convenient tool for due diligence, especially during M&A transactions or real estate deals. Due diligence is a legal obligation in real estate transactions as it helps minimize future uncertainties.
Virtual data rooms are not only full of amazing features, but they are also cost-effective. To be honest, VDRs can help you save a lot of money in different ways, and here are some of your business expenses that virtual data rooms can minimize:
- Document printing and shipping costs
- Charges for physical storage spaces
- Transportation costs paid to auditors
- Stationery costs
Besides, it is simply impossible to determine how cost-effective virtual data rooms are. That is because their overall benefits can simply outweigh their cost. Even if you compare virtual data rooms with other similar options, their cost is just a fraction of other cloud-based data storage options. On top of that, you can access them from any part of the world with just a single click.
Online data room software provides your business with a much-needed place to store and share data safely. They are highly secure, cost-effective, easy to use, reliable, and resourceful. Not using a virtual data room for your business can be a costly mistake, especially when data thefts are on the rise.