A virtual dataroom (VDR) provides an encrypted platform for sharing sensitive documents. It provides high-security with customizable access permissions. A VDR is more advanced than basic storage solutions which usually only allow viewing and downloading. It also permits simple collaboration between multiple parties, and can customize access privileges.
Due diligence can be a long process, requiring many parties to scrutinize a huge amount of information. This can result in lengthy and drawn out deals, or even the loss of the deal in the event that the documentation isn’t completed and properly prepared. A VDR allows all relevant information to be shared, reviewed and access by multiple parties in one central location. This helps avoid delays due to miscommunications or a lack of documentation.
VDRs can be utilized for a variety of reasons, such as helping prepare portfolio companies for public listing or for fundraising, in which the company is required to share confidential financial documents with third parties. The ability to arrange documents into logical folders to facilitate navigation and provide access rights with just one click make these tools very beneficial for investors.
For the life science industry, VDRs are an ideal way to share confidential intellectual property with investors and potential partners. With the ability to track document activity in granular detail and granular document activity tracking, a VDR lets users know exactly who has viewed which documents and for how long. This data can be useful in determining if a particular project is sufficiently researched and generating interest among potential investors. It could also assist in avoiding divulging proprietary information to wrong people.