What Is a Secure Data Room?
Secure virtual data rooms are the standard for sharing documents in the business. They allow businesses to easily communicate sensitive information to external entities without fearing a data breach and losing valuable information. Secure VDR can be a valuable tool especially in the M&A context where multiple parties require a review of important documents.
In reality, it’s an absolute requirement in many instances to implement a reliable secure VDR solution to reduce the risks of expensive data breaches and unauthorized access. Data breaches can have severe negative consequences for the reputation and finances of both businesses.
A secure data room is an online repository for documents that multiple users require to access at the same time. The platform enables secure, centralized distribution of documents and storage that can be used in M&A transactions, as well as other business purposes.
One of the most frequently asked questions about secure virtual datarooms is whether they prevent authorized users from sharing their files with non-authorized third parties. Some vendors claim that their solutions prevent this by extending the login process with 2FA, or by putting watermarks on downloaded PDF documents. But the truth is these methods aren’t foolproof and can be defeated with ease.
For example, the life sciences and healthcare industry has seen an increase in confidential documents, including clinical discoveries and patient information. This could lead to espionage, regulatory issues and expensive legal actions. A secure data room can help to prevent this from happening by providing features like remote data control secure messages, as well as a Q&A feature.