How to Build a Powerful Virtual Data Room

The key to building a successful virtual data room is a logical file structure with distinct, informative folder titles. This way, users will be able to find what they need within seconds. It also helps that the documents themselves are designed with clear and consistent formats (e.g. Text documents in PDF and financial documents in Excel will make it easier to view the files.

The level of permissions granted is crucial to stop document exfiltration and leakage. VDR software allows teams to be separated into groups based on their role in due diligence. For example, “management” or “finance” can be granted access.

Also the VDR should be user-friendly for all types of users such as non-technical founders, founders and investors. Searching and navigation should take just a few seconds and be as simple as navigating a busy Dropbox or drive. The tool should also support non-proprietary file formats and allow for easy collaboration with outside parties.

The most efficient VDRs come with advanced features which streamlines and makes simpler business processes — for example, M&A due diligence or the IPO process. A virtual data room that combines project management with a robust OCR engine can automatically read PDFs or other files. This is a crucial feature in M&A diligence workflows. The best solutions also offer 24/7 technical support, so that experts with the right qualifications are available immediately when needed during critical stages of a transaction.

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