How to Plan a Good Virtual Data Room

good data room

The importance of setting up a virtual data room (VDR) has become apparent over the last decade as they allow for secure file sharing and viewing while you can adjust rules to meet your own personal needs. For example, those working in mergers in acquisitions that need to protect certain confidential documents can do so through a VDR, while still being able to share those documents with the necessary people. Because they may contain such confidential information, the importance of setting up your VDR in the correct way is apparent, so here’s how.

Try not get too creative

Many software companies offer good VDR services that have all the functions you need. For example, it is possible to block particular documents from being viewed by certain people but allow others to access them, should the need arise. The security of most VDRs allows for detailed access options, such as who can view what, who has viewed what and even how many times they have viewed it. This can reveal how important a particular document or set of documents is to any particular person that has access to your VDR.
It is possible, with these available VDR solutions, to set up email notifications to be sent to the necessary people should additional information be added or removed to and from their folders within the VDR. Because of this, greater efficiency can be achieved by the team using the VDR. In other words, don’t get too fancy by trying to set up some sort of intricate, secure FTP site in-house: rather just use one of the available VDR solutions to save your own time and money while still being (most likely) more secure than anything you could set up yourself.

Be generous with your data

When it comes to setting up your VDR, it’s better to disclose more information rather than less. In the world of corporate transactions, for example, it is always better to make all possible information available so that, in case an issue arises, you can be sure that the fault is not yours in the eyes of the law. If you can prove that you disclosed everything required of you, then the chances of issues arising are far smaller. Basically, more is better when it comes to information sharing.

Access control

One of the main goals of all VDR solutions is, quite obviously, controlling the access to the secure information within the VDR. If you have data that you don’t want anyone to see other than your team or clients, then of course you want to be able to control that only they can see it. Access control isn’t limited to who, but also to what. In other words, you can control who can access to your VDR, but you can also limit what each party has access to.
You can use this control to your advantage: you could release teaser information to certain parties to get them more interested in a transaction before you release the full information to them. This is often useful as many transactions have particular milestones at which some parties might drop out, so it allows you to not give complete access to those who aren’t serious buyers.

Monitoring and maintenance

Most of the best VDR solutions allow you to add and remove documents and participants, and control read and printing access. It is, therefore, very important to monitor your VDR very closely to make sure you don’t lose track of who has access to what and to make sure you don’t let your system get too complicated. Regular checks are necessary, as deals could be won or lost based on basic VDR admin mistakes. Keeping your VDR in good, logical and neat order can also make a good first impression on potential buyers, and could lead to them being more interested based merely on your appearance of professionalism.

Following from this, editing how much you disclose for certain deals can affect how that deal goes. In many cases, prospective buyers might have a preference for certain areas of a transaction, so you could take advantage of that preference by purposefully disclosing extra information in that area to create the appearance of its greater importance.

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