The primary purpose of using the data room is to store important, share and track business documents. They are frequently used in M&A transactions or fundraising as well as other due diligence processes. As opposed to email or free file sharing services, they can be secured with password protection, two-factor authentication, watermarks and other privacy options. The ability to monitor and restrict access to sensitive data is particularly beneficial for companies dealing with sensitive information, such as medical devices or biotechnology products.
A data room can be accessed by authorized users from any location with internet connection, including tablets and mobile phones. Users can view, download and print documents in the data room or save documents for later review. Users can also request help, receive notifications when the document is uploaded, or if there's new comments made to an existing document. Furthermore, the data room is searchable, which makes it easy to locate the information that you require even when it's stored in many places or is not properly organized.
Create an organization structure for your folders that reflects the nature of your transaction or business to maximize the benefits of your data room. Label the folders clearly and group documents together to make it easy for buyers to see the whole picture. Consider implementing an audit log that tracks who has viewed and downloaded each document. This is an important aspect to prove compliance with regulatory requirements, or to protect intellectual property.