What Is a Data Room?

Documentation is crucial to any business. For example, it keeps a record of business dealings and contracts, provides governance, and proves compliance with local and international laws. 

However, like with any important files, security is one of the greatest concerns. Data rooms were invented to help keep documentation confidential. So, what exactly is a virtual data room? 

A data room is a specially curated environment that stores legal, sensitive, and/or confidential business documents. Security measures and special management practices provide a protected environment where business dealings can be discussed, sensitive files can be shared and viewed, and operational decisions can be made privately. Physical data rooms have been used for decades to conduct business dealings.

However, physical data rooms are slowly being replaced by online data rooms — a cloud storage solution that allows people to access sensitive documents securely. How can such a software solution benefit your business?

Why use a data room? 

Storing documents on in-company servers without proper security measures in place presents a great security risk. Hackers are always on the lookout for weak security points. Without the necessary infrastructure in place, they might gain access to your most important documents. 

Besides, when you want to share your business documents, it’s often better to use a neutral, off-site (or virtual) location.  A data room provides an impartial space that facilitates business dealings without pressure. 

Main benefits of data rooms

As seen in the aforementioned examples, datarooms are making their way into almost every industry. What makes them so attractive? What are their main benefits?

  • Security. One of the core benefits of a virtual data room over a standard cloud-storage service is its security features. Through regulatory compliance,  this virtual space provides bank-grade security and file encryption. 
  • Accessibility. A virtual data room is built around two premises — security and accessibility. A dataroom is perfect for making deals in a safe environment, reducing the risk of a data breach. 
  • Cost-effectiveness. Compared to physical data rooms,  VDRs are much more affordable. Your company does not have to rent a space, employ security guards, or cover travel and lodging expenses for interested parties. 
  • Efficiency. A data room provides authorized personnel access to needed company files anytime, from anywhere — with only an internet connection. This helps to improve workflow and promote company processes. 

Tips for implementation 

You might see a need for a virtual data room solution for your company. We have a few tips that might help you with implementing this online storage service into your business. 

Talk to the providers directly. Contact the provider to discuss your needs for secure data storage. A company representative can present you with your options and calculate a personalized quote.

Read reviews. See what other people are saying about the provider you are targeting. What are their use cases, and what are the pros and cons of the solution proposed by their virtual data room?

See if there is a free trial available. A free trial allows you to form your own opinion about the product. In addition, you can see what tools are at your disposal and how they’ll fit your company.

Keeping your company files safe is important for any business. Using virtual data rooms  to store your documents in a digital space offers bank-grade security and accessibility for authorized parties. Employing a virtual data room solution in your company might be much easier, thanks to our tips. Find out if your business can benefit from this software solution.