There are a myriad of situations where companies can make use of the virtual data room to facilitate secure document sharing without the need for an expensive physical space. The most typical VDR usage is during due diligence in mergers and acquisitions, but they can also be used to share documents with clients, business partners as well as other stakeholders.
A virtual data room is ideal for M&A transactions because it permits sellers and prospective buyers to review documents in one location, without exposing sensitive information. Investment bankers also utilize VDRs to share confidential documents with clients and other stakeholders during M&A or capital raising processes. Technology firms use VDRs to share design and manufacturing information across teams throughout the globe. Consultants employ them to spot patterns from large data sets that can help inform corporate strategy.
A VDR can also reduce M&A costs by cutting down on travel and printing, and by allowing access to documents more easily than would be possible using an actual repository. Additionally, it is easy to customize the storage structure to fit each project and to grant restricted access on a document-by-document basis.
VDRs are usually accessed through the internet, so users can view documents anywhere they have internet access. Administrators can also access detailed reports of user activity that include who viewed what, when and where. This information may not be accessible with physical storage, where access logs can only provide information on what is being used and by whom.