Post Menu and Details.
- What is a virtual data room?
- Who can use a virtual data room?
- How to use virtual data rooms?
- Remote and centralized data storage
- Data security
- Real-time communication
- Summing it up
Reading time: ~4 minutes
Business spheres mostly associate virtual data rooms with transactions like initial public offerings (IPO), capital raising, mergers, acquisitions, real estate portfolio management or transactions, commercial bidding, etc.
However, that does not mean that data room software is limited to high-profile business transactions. Technological advancement and problem-solving are the forte of virtual data rooms, but they are more than good for general business use.
Today, let’s uncover some fruitful benefits of online data room software for general use in businesses, starting with an introduction to data room technology.
What is a virtual data room?
A virtual data room (also known as an electronic data room) is a centralized digital platform with multiple functionalities such as data storage, data sharing, deal-making, project management, and online business communication.
Virtual data rooms are essentially online data repositories for companies, enterprises, government agencies, nonprofit organizations, remote workers, firms, service providers, and anyone who deals with professional or business data in any capacity. The good thing is that data room software allows its users to upload or store files in multiple formats of documents, images, audio, videos, etc. Some vendors support more than 25 file formats, for instance.
Apart from highly secure and centralized data repositories, virtual data rooms are equally safer and faster for online business communication. What makes them unique is their wide range of communication tools for individual conversations, conferencing, and webinars. Businesses can use data rooms for their routine communication needs and specific cases.
However, data room services vary from vendor to vendor, as businesses now demand customized solutions. Some data room vendors like Merrill and DealRoom specialize in providing services for large-scale transactions, while others, such as Box or Google Workspace, target small businesses, freelancers, and remote workers (read more about virtual data room vendors on https://dataroomreviews.org/).
Who can use a virtual data room?
Virtual data rooms are for any professional or business entity that has data storage or data management needs. Opting for advanced features totally depends on a business’s needs, but data storage, management, and online communication tools are mandatory elements in any VDR.
Following industries, businesses, and professionals are already using data room software:
- Financial institutions
- Investment banks
- Healthcare organizations
- Pharmaceutical companies
- Private equity firms
- Oil and energy industry
- Real estate firms
- IT firms
- Service providers
- Remote workers
- Company directors
How to use virtual data rooms?
The use of online data rooms in different industries depends on specific business needs, but there are some very general uses for data room software, such as those listed below.
Remote and centralized data storage
Even if you are a solopreneur or run a small-scale business, you still have to manage a database system, no matter how small it is. If you keep it on your personal computer, your partners or employees will depend on you. If you maintain a database in your office, your workforce still relies on on-site data storage.
In fact, how can we ignore the fact that a business deals with multiple types of data, such as financial data, marketing data, HRM data, and tax records? It also means personnel from different business sections may maintain separate databases.
But imagine, what if you could maintain all types of business documents in one centralized place and segregate them as per your needs?
An online data room is a cloud-based platform that stores your data in one place. The best part is you can access it from any device like desktops, laptops, mobile phones, and tablets. That’s not it; you don’t have to be physically present on your business premises to access your documents. That is because you or your team can access your data rooms from anywhere.
The remote accessibility feature is immensely beneficial for remote working teams, investors, stakeholders, managers, or business owners.
Storing business data in one place is not enough; protecting it from external or internal threats holds the same importance. If data rooms are centralized and remotely accessible, how can you control your workforce from accessing documents that are out of their domains?
Although data rooms are centralized platforms, you still have 100% control over your business documents. As your data room administrator, you can easily decide:
- Who can or cannot access specific documents
- Who can or cannot edit, share, download, save, print, or copy a file
- And who can or cannot access a folder, section, or even a single page in any document
Other than that, you can also add or remove data room users without any prior notice. You can delete devices connected to the data room or revoke document access anytime. In fact, you can ask data room users to sign NDAs to prevent data leaks.
No matter how small, any business can use virtual data room software for safe and quick communication. It can be very difficult for your team to manage different platforms for data storing, sharing, and team communication. That is why data room software is highly used for keeping business communications and data management in a single platform.
You can use virtual data rooms for business meetings via audio or video conferencing tools, create live polls for user opinions, do live Q&A sessions, or even engage in one-to-one communications. No wonder virtual data rooms are immensely popular among freelancers, service providers, and remote teams.
Summing it up
“Virtual data rooms are high-end solutions just for big companies” is a narrative not more than a myth. They are or can be used by small businesses, retailers, service providers, solopreneurs, freelancers, and small-sized firms. Their core objective is to keep your data safe and remotely accessible anytime.
Thank you for reading!