A data room is a secure system for online document storage that can be used to share and exchange confidential documents. It is usually used during the due diligence phase of a deal but it is becoming increasingly used for other purposes, like fundraising and business restructuring.
Data rooms are designed to make it easier and facilitate the due diligence process. They enable companies to share sensitive documents with potential investors and business partners in a secure, user-friendly and easy-to-use environment. They are able to be used to facilitate a wide range of business transactions like mergers and acquisitions including capital raising, joint ventures restructuring, listing on stock exchanges and debt financing.
Users can be invited via either a customized or pre-defined list of email addresses based on their roles or contributions to the project. They can then be granted or restricted access to specific folders, documents, or the entire contents of the data room. This permits only those who are authorized to access the data to do so. User audit trails for each user are made available to ensure that all can trace who has seen what and when – vital for legal reasons.
Watermarking and role-based security, as well as virus scanning, and data encryption are all features that provide robust security. The system can be configured to meet specific standards of compliance for the legal, biotechnology and medical sectors including ISO 27001, GDPR, GCP and HIPAA. This will improve the efficiency of the work processes and reduce operating costs.
