Experienced businessmen might still remember how time-consuming, tiring, and expensive due diligence used to be especially if companies that are going through this process are located in different countries or even parts of the globe.
Before the Internet arrived, people had to travel to the potential partner or buyer and fetch all the needed documents. Therefore, companies had to cover expenses on tickets, hotels, car rentals, meals and so on. Also, the employee that traveled to another company had to get paid. And since traveling takes time, due diligence could last for a few weeks or even months, if there was a need to fetch other documents.
Happily, today we don’t have to deal with all these issues because we have technologies that brought us one of the most useful tools – a virtual data room. With a VDR due diligence is quick and straightforward. This software makes the process go smoothly and protects all the sensitive data you upload to your data room.
Why is a due diligence room better than a generic cloud storage?
The safety of your corporate documents should be the primary concern. Data leaks cost companies an awful lot of money – it’s quite a good reason for businesses to start caring about the security of their data. Unfortunately, online repositories like Google Drive and Dropbox are not protected good enough, and multiple cases of personal accounts getting hacked prove that this software is not that reliable to trust it corporate data.
Even though generic cloud storages are free to use or very inexpensive, this insignificant amount of money you will save is not worth the risk. With the virtual data room, due diligence is secure so that you can leave all the worries about the safety of the data behind. Data room providers use the most robust encryption available to protect not only the storage but the information while it’s being transferred, too. Therefore, hackers have no chance to steal or corrupt your files.
If the encryption is still not enough for you, data room services offer functions like watermarks to provide users with additional protection. Also, some providers have unique tools like fence view mode to go through documents in public places. And every VDR allows the administrator to control the level of access other users have. So if you use a data room due diligence will be safe.
Are there features that can speed up due diligence?
Yes, there are a lot of them. Users can comment on the documents and highlight details they feel to be essential to draw the attention of others. All parties see the changes instantly and can react quickly. Also, once the new document is uploaded or the existing one was changed, members of the virtual data room get notifications. Therefore, they can get into the storage right away and study the data.
Another helpful feature a due diligence room has is a Q&A section. Here third-parties can leave their inquiries and quickly find answers if the seller side has gathered frequently asked questions and answered them. This section is an excellent source of information, and if you go through due diligence not for the first time, you already know what questions might third-parties have. So answering them in advance, you will save a lot of time for all sides.
Almost any secure data room can be accessed easily from any device and any moment. To make sure that unauthorized individuals won’t get into it, this software has a two-factor authentication that requires the user to prove their identity in some additional way. Thus, data rooms remain accessible yet highly safe.
Other reasons to get a data room for due diligence
Having a dedicated tool for such an important business process due diligence is you show your potential partners or buyers that you take things seriously. It gives you a lot of credit, and your company looks more trustworthy than it would if you used generic cloud storages. That’s a huge bonus you shouldn’t overlook.
Also, many providers trying to win the harsh competition on the VDR market often offer unique solutions for specific businesses. So if your company operates in some particular market with certain unusual needs, you will find virtual data room useful not just for due diligence but for other business processes as well.
Last but not least, VDR providers usually have flawless support. The team of specialists is ready to help users 24/7 and guide them through all the business processes they are struggling with. You will never have this with a simple online storage. And having access to the support team at any moment is crucial during due diligence. Even an hour of delay can spoil the deal.