Online data room software is primarily used for M&A transactions and due diligence procedures, as well as other business transactions that require the transfer of confidential documents. This is especially relevant for tech startups that’s growth and development are usually dependent on being acquired or acquiring a goal exit or as a milestone.
During M&A due diligence, all participants have to go through immense amounts of documents in remarkably tight timeframes. It is essential to select a virtual dataroom provider that has advanced security features and granular permissions. This will allow you to avoid losing important information. Look for features such as two-factor authentication as well as timed expiration of access, multiple levels of permission for users and IP-address-based access restrictions. It is also essential to check whether the provider is in compliance with the highest security standards by listing certifications like ISO 27001, SOC 1 & 2, HIPAA, and GDPR.
When selecting an online data storage space, you should take into account the size of your company and the amount of documentation you will be uploading and managing using the system. Startups usually have fewer documentation, while larger enterprises might require more advanced features. To meet your requirements choose a vendor that has a customizable interface, mobile apps for iOS and Android devices that allow batch uploads as well as reporting on document activity, tag and foldering and the capability to search for files by type, and an option to create groups of users with varying permission levels.
Certain VDR providers, like Brainloop Secure Dataroom, offer the option of a free service for small and medium-sized companies. Others, like iDeals, Merrill Datasite, Watchdox and Ansarada offer unlimited storage for all customers.