May 24, 2024

Data room technology is utilized by companies to securely share critical and sensitive documents from due-diligence procedures for M&As, joint ventures and patent applications, debt syndications, and private equity investment. It is different than cloud storage in that it offers document management capabilities that help to make the process easier and more efficient, and is specifically designed to lead teams through complex business transactions. Modern VDR providers provide in-app chat, phone and email support in multilingual languages, dedicated teams managers, as well as help centers that feature product videos. This is something cloud storage solutions usually do not take into account.

VDRs shouldn’t be difficult to utilize, but at the cost of security. It is important to choose what to share and how long to share it with investors. It is also essential to give context to the documents you share. For example, don’t share non-standard analyses such as showing only one part of a Profit and Loss statement instead of an entire view.

It is also essential to stay clear of the “trickling effect” of information during a process of financing. Investors may ask questions about your company. To keep them interested, you must be prepared with information that will answer their questions in a timely manner. FirmRoom is a VDR that’s fast, secure and easy to use.

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