Unknown Facts about Virtual Data Room For Secured File Sharing

Last updated on July 15th, 2023 at 12:12 pm

The global data room software market is expected and projected to increase from $1.6 billion in 2021 to $3.2 billion by 2026, at a Compounded Annual Growth Rate of approximately 14.5% during this period. Numerous factors such as the increasing importance of business data due to complexities occurring during M&A activities and the transition to remote work during the coronavirus pandemic are accelerating the usage of virtual data rooms from reputed data room service providers like Confiex Data Room, among others. The effective utilization of innovative technologies and techniques has become essential as buyers, vendors, top executives, financial and legal advisors, and even administrators adapt to the rough business environment and look for platforms that are fast, and secure for online data storage, secure file sharing as well as for due diligence and deal-making.

A virtual data room, also known as a data room for investors is a secured online repository for your business sensitive documents and a secure file-sharing cloud-based platform. Businesses globally use secured data rooms for deals as it protects their vital business data and information by robust security protocols, as well as ensures seamless and secure access anytime, from anywhere in the world, and on any device.

The need for a virtual data room

A data room for investors is an on-demand solution for storing, organizing, and securing file sharing of sensitive business data. Business organizations use a data room for M&A or any other type of business deal, because it safely shares data with only authorized persons, thereby preventing it from becoming a liability. A virtual data room or a data room software fuel and helps hasten corporate decision-making in many aspects of business and is a very crucial and critical component of many business processes like mergers and acquisitions, fundraising, IPOs, and almost every other strategic business deal.

It is cost-effective and lets secure file sharing of data between multiple employees of the same company or between different organizations and their third-party consultants, bankers, and legal advisors. A virtual data room from a reputed data room service provider like confiex data room eliminates the need for physical documents, which in turn reduces the costs of printing, filing, and storing physical documents. Another major expense that a data room M&A or a data room software eliminates is the cost and time of traveling for the sole purpose of viewing or scrutinizing documents before initiating any deal process.

A due diligence data room facilitates and quickens the pace of the due diligence process during an M&A, private equity, venture capital transaction, or even loan syndication. A secured data room for deals also reduces the geographical limitations that once made the process of negotiating, communicating, and deal-making across borders laborious and time-consuming.

How does a data room for investors safeguard data and information?

A secured data room for deals offers a bank-grade level of security for the data stored and in transit. A few of the security features that most reputed data room service providers like Confiex data room offer include:

Physical data security which ensures ongoing and continuous data back-up and availability above 99.9%
Infrastructure security that allows 256-bit AES encryption and protects data stored in remote data centers
Application security that implements robust encryption protocols while in storage and in transit, multi-level and multi-factor authentication, as well as data siloing in private cloud servers
Document permissions and restriction settings. Most data room for investors provides security features such as ‘view only’, which prevents data from being copied, shared, and/or printed without permission. Another restriction is setting permission that allows viewing only certain part of the data that is relevant to the role of that particular individual in the deal-making process
Digital Watermarking is the use of an embedded marker on the data (whether it be audio, video, text, or image) to identify ownership of the data. There are two types of digital watermarking-visible and invisible. This allows you to track who is downloading and printing data, which helps prevent data leaks. Most of the good virtual data rooms by reputed data room service providers like confiex data room have both dynamic and static digital watermarking.
Audit Trails and Compliance helps analyse activity logs provided by the data room service provider or data room software and also prove compliance with various regulatory standards.
The ability to check which IP, device, and location a user logs in from. This enables you to see when and where the user is logging in from. This helps protect against data leakages and misuse of your secured data room for deals.
Single Sign On (SSO) Integration. SSO is a user authentication service that allows users to enter one set of login credentials, such as user name and password, and be able to access multiple applications.
Customizable NDA. This feature of data room software requires all the users who log into a virtual data room to accept the NDA before they can access the documents.

What are Virtual Data Room Certifications for Security and Compliance?

ISO 27081 Compliance. An ISO compliance means the data room forinvestors follows the guidelines set forth to protect Personally Identifiable Information (PII) in storage clouds. Specifically, ISO 27081 is considered the premiere security choice for cloud storage systems (vs. ISO 27001).
FINRA Compliance. The Financial Industry Regulatory Authority aims to protect investors by making sure the security industry operates fairly. It is the largest independent regulator for all securities firms doing business and offers regulatory oversight.
SOC2. The Service Organization Controls relate to the secure handling of financial documents.
Compliant with Safe Harbor’s international privacy practices.

Pick the Best Virtual Data Room Suitable for Your Business Needs

Virtual data rooms are a very powerful tool for scaling your business and reducing costs on M&As. But a mistake here can prove very costly too. With so many attractive offerings on the Internet, it can be difficult to make a choice. Here are a few simple tips to bear in mind

Define and analyse your needs and capabilities: what exactly are you planning to achieve with a secured data room for deals?
Identify desired features: what is more important for your company?
Consider your budget: how much can your business spend?
Read a reliable data room review to see and choose your best option;
Compare virtual data rooms to examine the solutions in detail;
Go to the site of the preferred vendor to learn more about the product;
Check the data room service providers security page
Test the solution with a free trial.

Conclusion

Protecting and sharing important documents virtually is a new norm today. The usage of online data room software only increases in popularity and the market for these solutions keeps on growing by the day. Therefore, in order to scale your business, improve your collaboration, encourage efficiency, and considerably lower the number of redundant tasks, a good virtual data room from an internationally reputed data room service provider like confiex data room should be your next business priority.

Confiex Team

The Confiex team specializes in providing premium virtual data room solutions tailored for businesses. With their vast experience in working with document sharing platforms, they have been actively supporting the Virtual Data Room community since 2015 by offering valuable information to users free of charge.