Virtual deal rooms, also known as electronic data rooms, or VDRs, are secure online repositories which allow multiple parties to collaborate on documents and other data relevant to business transactions. This virtual deal room includes due diligence and fundraising, M&A, strategic partnerships and IPOs.

A VDR unlike consumer-grade cloud services such as Google Drive or Dropbox is designed to protect confidential business transactions by ensuring only authorized users have access to confidential documents. Administrators can assign user-role permissions and monitor user activity. This makes them a crucial part of the M&A process that allows lenders and investors to review confidential documentation during the due diligence phase of an acquisition or funding round.

In addition to ensuring security, VDRs provide a range of additional benefits that improve efficiency. They can, for example, help reduce due diligence timeframes since they permit participants to view documents from one location. They can facilitate remote collaboration by reducing the need for participants to travel and save on overhead costs and environmental impact. In addition, they can help simplify document management by reducing paper usage and establishing a platform for collaboration that is recognized worldwide.

Find a service provider that is committed to ongoing innovation and has a thorough understanding of the needs of M&A professionals. You must look for a roadmap that is robust as well as a community of users that are willing to share their best practices. For security measures that are strong look for providers that have ISO 27001 certification or SOC 2 type 2 attestation.