The globalization of business and the advent of disruptive technologies offer vast opportunities for companies. However, these changes also present threats to the security of their data. The development of virtual data rooms(VDR) is a welcome development in the efforts to prevent data breaches.
Companies, big or small, suffer huge losses due to data privacy violations. Based on the 2019 Cost of Data Breach Report by the Ponemon Institute, the average cost of data breaches worldwide stands at $3.92 million, up by 1.5% from those in 2018. Organizations should adopt strategies against data breach, like the use of VDRs from reputable providers.
This article discusses some potential business applications of VDRs, as well as their benefits and advantages.
Key Benefits and Advantages of VDRs in Business
Virtual data rooms are new online software for the safe storage and sharing of business documents in different transactions. There are various benefits and advantages of VDRs, and they also play a significant role in achieving positive transaction results. Here are some of the benefits and advantages of VDRs:
- Transaction speed– Time is crucial for businesses because of its impact on cost, efficiency, and productivity. With VDRs, you can upload your documents faster, thus, facilitating business deals.
- Safe and secure data – Credible providers have their strategies and tools to protect your data. Among them are malicious software checks, watermarks, data room restrictions, and complex authorization protocols.
- Round-the-clock monitoring and tracking– These features allow the parties to check on the performance of each other. As a result, they can gather information about prospective partners and can negotiate effectively.
- Comfort and convenience – Compared to physical storage rooms, VDRs are more convenient to use because you can access it anytime and anywhere. VDRs have real-time notification systems to make sure that all parties get the latest updates.
Some Possible Applications of VDRs
VDRs are new business tools which have the potential to use in various industries and by different organizations. Their effectiveness for sharing sensitive information via the web is of utmost importance. Here are several potential use cases of VDRs:
- Merger and acquisition (M&A) due diligence– DVRs are mainly used in the due diligence process of possible M&A transactions. You can share and exchange to review vast volumes of sensitive documents without face-to-face meetings.
- Management of legal documents– Lawyers can use VDRs to safely and quickly obtain materials they need to review. They can also secure subpoenaed documents quickly and access new court filings immediately.
- Commercial Real Estate Deals – VDRs allow involving parties to get additional documents they need while in the middle of negotiating a real estate transaction.
- Capital Fundraising – During a fundraising campaign, companies can use VDRs to allow prospective investors access to their financial and other relevant information.
- Regulatory risk management –Anorganized set of documents allows companies to obtain records for regulatory compliance quickly. By using VDRs, they can easily retrieve these legal papers by just dragging and dropping files into their browsers.
Regardless of the type of business or industry, you can use VDRs to protect and store company documents. With this technology, you can focus on managing your transactions for successful results.