Last updated on June 26th, 2023 at 10:59 am
INTRODUCTION
You are about to sign a new deal and would need the services of a Virtual Data Room. But this is where your problem starts, because not all data rooms were created equal. Some data rooms will be jam-packed with features while others will only give you the bare minimum. Virtual Data Rooms pricing is generally based upon the number of projects, administrators and guest users, plus file storage size. But the key feature where the main differences among the plans are to be found is in document management, document security, user management, tracking and reports, and data hosting and compliance among others. The plans also differ in other key aspects, namely, support level, customization level and integration reach.
Some VDRs charge more, while some other VDRs may apparently show that they charge less, but actually have a lot of hidden charges or inflexible contract terms that will surprise and hurt you later if you inadvertently sign with them. So, when assessing the pricing of a VDR you have to be sure to look at the long-term value of the platform and the service you are going for. When comparing prices of VDR service providers you need to check out the following:
Check what Service is included and what is not?
There’s a difference between a good data room platform and a good data room service. You’ll need both. It’s important you check:
- If your VDR provider will help you set up the data room and manage it for you.
- If there is a limit on then how many hours will they help you with in that price.
- If your provider will give you a dedicated co-ordinator who understands your deal and can support you 24/7.
Not all providers offer clients service within their prices. This is why you could see a higher price for one provider versus another. The additional service you’ll get from that provider might cost you a little more today, but it will save you a lot of time and hassle tomorrow. Check what’s included. And what’s not.
Is your VDR charging by users, storage or something else?
Some VDR providers charge you by how many users you need to give deal room access to, while others will charge by how many documents you need to store. It’s best to figure out which option suits you best and how your use of the data room will affect future costs. A good VDR provider will give you a pricing structure that’s flexible and can be tailored to the different deals you’re working on.
How long will you need your VDR for?
This will obviously affect the price. If your requirement is for a longer period then paying monthly will prove to be more expensive versus paying a yearly subscription.
Will you pay a flat fee or pay as you go?
How you are going to use the VDR in the future will decide whether you would rather pay a fixed fee, or a flexible fee. There is no right or wrong in this. A fixed fee may cost more, but it also frees you from the hassle of constantly monitoring your usage. Select a data room that best suits your option and is flexible with different payment methods. Be aware that each provider will also have a different invoicing process – pay in advance, pay at the end, pay 70% upfront etc.
Read the small print
Selecting the right VDR is of utmost importance. Some providers will advertise features they don’t then include in their standard package for dealmakers. Look closely at the fine print about what you’re paying for (and what you’re not), and see if there are any hidden costs such as receiving service from your deal room coordinator on weekends or outside office hours. The latter is crucial when it comes to the due diligence process of your deal. If a provider’s terms and conditions are hard to comprehend or are confusing then its best to move on to a different VDR, who gives you more clarity. A provider should be making your deal simple, not adding stress to it. You should always go with a VDR provider that you can trust.
Brand name
Some data room providers have been around for a long time and have built up quite a reputation. Such data room providers will charge more simply because they are big brand name and have a lot of prestigious clients. Needless to say, be sure to do your homework, shop around and compare prices, to decide if a certain data room fits your needs.
Additional Bells and Whistles
When you compare all of the pricing plans that the service provider offers, you will notice that the more expensive plans offer the most features. If you know that will be difficult or even impossible to complete your project without the features offered in the more expensive plans, then certainly it is worth shelling out more in order to get comfortable working conditions.
Before you get to compare the prices all of the data rooms out there, ascertain the scope of the project and the tools necessary to work on the project. You may find that you only need a minimum amount of storage without any complicated features. However, it is always a good idea to know what you are looking when you are shopping for a VDR.
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.