Data Rooms for Due Diligence

Useful features of data rooms during due diligence

Various teamwork and productivity tools are getting more and more popular. And almost every company seems to use something to make the workflow simpler. Still, there are many businesses and even finance professionals who are using generic cloud storages and maintaining all the document hassle via email during due diligence.

They have to worry that all members of the process get the needed files, that these documents are up to date, what is the status of the deal… The list of responsibilities goes on and on. While with a virtual data room you can avoid all these problems.

A VDR streamlines all the processes during due diligence saving time and efforts for all parts. The sell-side company has complete control over what’s happening with the documents, who can view, edit, print and share them.

Also, the sell-side can create a Q&A section to quickly answer questions interested parties ask. And once the deal is done, a virtual data room offers complete stats on how did the process go. It can give business owners a lot of useful insights.

But benefits data rooms have are not limited by ones that are already listed. This software has other features that are extremely useful during due diligence.

due diligence data room

Upload in bundles

If you have an already established system of folders and subfolders on your computer, you don’t need to upload file by file. Just drag and drop everything at once as one big bundle. Then go once more through all documents to make sure everything is up to date and in the right order, and you’re ready to invite other parties to your data room.

Notifications upon the upload

Now you don’t have to notify everyone that an updated document is uploaded. All members invited to the virtual data room will get instant notifications. Once they tap it, they will see a new file instantly. It speeds up the due diligence process significantly since everything happens in real time mode.

Highlight important parts

Are some paragraphs in specific files more valuable to interested parties? Highlight them in your data room so they will draw the attention of others. Such trick will make potential buyers see all the benefits first.

Interact with parties

Q&A section allows answering the questions instantly. However, it’s not the only use of this feature. You can assemble this section in advance adding frequently asked questions and solving them right away. Thus, it will relieve you from answering the same question over and over again, and let others get the information quickly.

Watermarks and branding

Virtual data room providers usually offer users to put personalized watermarks over their digital documents. It prevents the possibility of theft and makes papers look more trustworthy. To add your company even more weight, you can brand documents with logo and corporate colors.

Two-factor authentication

This feature means that members of the data room will need to use one more way to confirm their identity in addition to entering login credentials to enter the storage. They will have to either type in the code sent to their phone upon logging in or do any other action offered by the provider. It eliminates the possibility of someone unknown getting access to the data.

Control over the actions of others

A VDR owner can set the level of access for each user and change it as needed. At the beginning of due diligence, an administrator can let others only view the files extending the options as the process evolves.