Online Data Room Software for M&A and Other Transactions

Among the primary uses for online data room software are M&A deals and due diligence processes and other business transactions involving the transfer of confidential information. This is particularly true for tech startups, whose growth and development often hinge on being acquired as a goal exit strategy or a significant milestone.

During M&A diligence, participants must review an extensive amount of documents within a short period of time. To ensure that valuable information is not lost, it is important to choose a virtual data room that offers the ability to grant permissions at a high level and with advanced security features. Look for features like two-factor authentication, timed access expiration, multiple levels of user permissions, and IP-address based access restrictions. It is also essential to determine if the service adheres to the highest security standards by listing certifications like ISO 27001, SOC 1 & 2, HIPAA, and GDPR.

When choosing an online data room you should take into account the size of your business and the amount of documentation you will upload and manage with the solution. Startups are more likely to have less documentation, whereas larger companies may require more advanced features. To meet your requirements choose a vendor that has an interface that can be customized mobile apps available for iOS and Android devices with batch upload capabilities, reporting about document activity, tagging and foldering and the capability to search for files by type, and the option to create groups for users with varying permission levels.

Certain VDR providers offer a free version for small and medium-sized companies like Brainloop Secure Dataroom. Others, like iDeals, Merrill Datasite, Watchdox and Ansarada offer unlimited storage for all customers.