Benefits of a Virtual Data Room

Generic File Sharing Programs vs. Virtual Data Rooms

Generic Cloud Storage programs such as Google Drive and Dropbox allow users to store personal documents, photos, music, videos and more all in one place. These programs sync with an individual’s computer, phone and other devices and automatically update to reflect any changes. They typically have full sharing functionality such as folder sync, media streaming, free storage, and user messaging and collaboration.

However, these programs offer little to no security for sensitive documents and are geared towards personal use… not for business projects.

Security, complex reporting, advanced functionality and customer service are all important features that generic file sharing services do not offer. Virtual data rooms were developed to keep important information safe, providing selective access features and giving administrators total control over confidential documents.

Concerns with Generic File Sharing Programs (GFS):

• Employees that use GFS for sensitive information could compromise security
• GFS systems are not designed to handle specific document sharing processes such as due diligence
• Limitations to reporting functionality and ability to track changes
• Inability to determine who deleted folders/files and no process to recover deleted items
• Limited infrastructure
• Data security may be compromised by the host viewing documents for advertising purposes
• GFS hosting companies may be able to have some control and licensing rights over uploaded documents
• Personal information may be sold or shared with third parties

Concerns about the security of general file sharing programs can be solved by utilizing a specialized secure document sharing service such as a virtual data room. Virtual data rooms are specifically made for a variety of projects that require high levels of security such as mergers and acquisitions, legal transactions, business capital raises, due diligence, clinical trials and many more.

The Virtual Data Room Solution:

• Allows businesses to run due diligence correctly
• Comply with regulatory authorities governance and requirements
• Improve litigation support and allows for Bates numbering
• Support for multiple users and advanced reporting
• Allows for data encryption and watermarking
• Restrict who can view, copy and save documents
• Uploaded Information is never sold or shared
• Assures that uploaded information is never sold or shared
• Creates archives of all uploaded data

Virtual Data Rooms, unlike generic file sharing services, provide an easy and effective way to manage security, document permissions and revoke user access at any time during or after the project is complete. Users will receive real time notifications about activity within the data room to keep them updated as new information is made available.

Generic File Sharing services are the perfect fit for individual use when security is not top priority. However, when it comes to sharing confidential corporate, financial or legal information, a virtual data room offers the necessary levels of security, reporting and communication needed for business environments.