VDRs are software products which reduce the risk of data breaches and protect confidential documents throughout the M&A process. Their security toolkit dynamically adapts to changing needs. It includes multi-factor authentication as well as session timeouts and location restrictions document watermarking, click trails, and the ability to grant user permissions at a granular level. These tools safeguard sensitive data against cyber threats and improve due diligence efforts.
Most of the top VDR providers offer basic secure file sharing capabilities however, some have more advanced functions and security measures specific to different industries. For example real estate transactions require the capability to keep building construction plans and information, NOCs, mortgage documents, insurance documents, land register entries, contracts of sale, and more in a secure location. It is also essential to share and manage documents with all parties. Investment bankers also make use of VDRs to speed up the IPO preparation. They need to share large volumes of documentation with potential buyers of shares and being able to track who has accessed what documents and for how long is crucial for an IPO.
Some vendors provide additional services to facilitate an efficient transaction like onboarding support assist centers, onboarding support, and training. These services may be additional but they can speed up the M&A and boost the value of the deal. It is essential to determine what features you’ll require from your VDR and then select the right provider to meet those needs. If you select features that are unnecessary they could increase the cost of your project and cause delays.