Secure file sharing is especially vital for companies going through merger and acquisition processes. See why a virtual data room may be the best solution.
In this connected and hack-prone world, hard copies of documents are no longer a viable solution. However, general file-sharing services don't offer enterprise-level features. The best option, even for a startup company, is a cloud-based virtual data room (VDR). This solution offers security protection, as it is password-based with different access levels.
VDR is a proven method of data storage, especially for companies going through a merger and acquisition, as it facilitates the transition process. During the creation of the new identity and company structures, a virtual data room will help you to access all the required information about a company in a single place. Stakeholders from both entities can quickly, efficiently and safely retrieve all the documents they need and even share them with auditors or other specialists.
So, how does a VDR facilitate the transition process?
The initial setup cost of a VDR could seem prohibitive, especially for a new company. However, in the long run, this solution is a one-time investment with a small recurring monthly or annual fee. You're only looking at a fraction of the cost of creating, maintaining and securing a brick-and-mortar archive. This solution works best for companies aiming to develop globally and take advantage of a remote workforce. A VDR offers each employee access to documents and tracks their usage to prevent information leaks.
Also, you won't have to spend money on frequent updates and changes in the hardware. The VDR provider will handle all these things.
If you are running a small business, you can use a virtual data center to efficiently protect your sensitive information. If your entire business revolves around the secure storage of your data, you will be able to monitor potential threats, usually with a monthly report. A VDR solution can get you the best protection and detect risks in the early stages. All your data will be maintained and protected adequately.
However, online data storage is a way to stay safe and lean only if your chosen solution comes with built-in firewalls, encryption and other security measures. Otherwise, you will need to employ a professional IT team and ensure they stay on top of all the essential upgrades for the right data protection. In brief, either choose a vendor with exceptional knowledge about data protection or get an in-house team of professionals. Just factoring in their paychecks makes a VDR solution seem more affordable.
You need to ensure that the right people have access to critical data at all times. In the midst of an M&A, professionals from different companies will need access to specific files or documents. With a virtual data room, the process will be much easier. They can get permission to access documents or files based on a set of credentials that regulate specific rights. This makes it simple to lock documents that are not part of the M&A process. It will be less time-consuming and more efficient.
In fact, some VDRs come with many specific features like tracking changes and data or document transfer. This enables better access to documents and increases accountability.
A VDR can reduce travel costs, since you no longer need to find accommodation and transportation for the specialists involved in document analysis. If you are dealing with a physical data room, you might find it hard to access documents unless you have a physical or hardwired connection to the network. Therefore, you need to ensure that all data-related tasks can be completed onsite. By doing so, you will not have to travel to the physical location frequently to get access to any required data.
With a VDR facility, you can access documents remotely whenever you require, or you can forward them appropriately without any hassle. You just log in to your Wi-Fi or use your mobile device to access anything you need. Some VDR providers also have their own mobile apps to get you up to speed, also offering top security features. You can use video calling or conference calling to clarify any information, just like in a physical setting. That will help you to plan the next step with a consensus.
It is considered more effective when the acquisition or merger involves a company with a different location. Through a VDR, the other company can access the required data more easily without traveling to the physical area.
A VDR is very practical for most businesses. It can be an excellent option for companies considering a partial or complete merger or acquisition. As all entities will have easy access to data, it allows different parties to take care of due diligence at the same time, speeding up the process. Moreover, sensitive documents will be dealt with utmost care and protection.
Considering the aforementioned reasons, virtual data rooms are one of the best mediums for protected data sharing, especially when companies are thinking about a complete merger or acquisition. You can also use a VDR for ongoing protection or easy access to your secure data, eliminating the costs of a physical location to store your archive and the danger of losing your documents to deterioration. You can even make information easily accessible while fielding bids from many businesses. This will make the process easier for you and the bidders.
Although a VDR requires initial substantial costs for setup, the investment is worth it. Companies find the process helpful, as they don't have to spend on travel, accommodation and daily allowances for specialists. Accessing data is easier and more effective, making the transition quicker and more secure with all the required data in hand. A VDR will help your company avoid the delay you might experience while accessing data from physical locations.