A virtual dataroom (VDR) allows authorized users to access confidential documents through an encrypted platform. VDRs simplify legal processes and enable businesses to share sensitive documents more easily with key stakeholders. The most common use for VDRs is due-diligence during mergers and acquisitions, however all businesses require the security of collaborating on documents.

Users must sign up for an account before they can use a virtual dataroom. This involves registering, filling out your personal information, confirming the terms of service, privacy policy and changing security and notification settings. After creating an account, users can upload their files and make folders to organize the files. After uploading, they can invite other users to the VDR by using email links. If they do, they’ll need to set permissions to control the types of files and actions each user is able to access, such as two-factor authentication or fence view, which blocks authorized users from capturing confidential documents on the screen.

Once the VDR is up and tested, users are able to begin sharing materials with potential investors. A VDR is more intuitive and simple to use than messaging or email platforms for sharing files. It is also not necessary for the administrator to search through emails and messages from the past or handle duplicate requests. Virtual investor interaction solutions save money and time for the company and the investors. They cut down on travel expenses and also eliminate photocopying of documents and indexing.