A data room is an electronic vault which stores confidential documents. The most common use is during due diligence on an M&A deal, where both sides need to review business-critical documents and contracts. However, it’s also used to communicate information to investors in financing or restructuring projects, or with third-party companies for ediscovery or bankruptcy proceedings.
The non profit executive board best data rooms are built with the due diligence process in mind and offer features such as granular access rights and reports on user activity. The administrator of the data room can see which users have viewed or downloaded particular documents. They will then be able to ensure that only authorized parties are accessing confidential documents.
There are a myriad of file sharing tools that are free and simple to use, however they may not have the security or features of a virtual data room. These tools may also not include the proper folder structure, search functions, and other crucial features required to support a successful due diligence process.
It is important that the data room offers the capacity to store a variety of documents according to the amount of documentation will be uploaded and saved. It’s essential to be able to choose the flexibility and security of being capable of modifying or reducing subscriptions without difficulty. It’s also important that the data room supports team collaboration, with features like secure chat, video conference calls and an extensive Q&A tool that can assist in managing the due diligence process.