A virtual dataroom is an online secure repository of private documents which is typically used during due diligence in an enterprise transaction. Due to advances in technology and the rise of remote working, virtual data rooms are being utilized throughout the lifecycle of a transaction and for other corporate events, like fundraising, divestitures, or business restructuring.

The most reliable online VDRs have strong security features, such as global compliance certificates and data protection. They should also provide a suite of reports that show the user’s activity and information, from the type of documents that have been viewed to how often they’ve been downloaded or printed. This level of transparency will help data rooms to comply with rules like HIPAA and ISO 27001 and reduce the risk of sensitive information leaks.

Finally good online VDRs include many features that help improve team communication. These include FAQs and questions, document annotations and comments in real-time, instant notifications and follow-ups. These tools enhance communication and assist teams in making better decisions.

When looking at online VDRs look for vendors that provide free trials of the software. These are a great way to determine if the software does what it says it does and find out how user-friendly and intuitive the software is for you and any third parties that you intend to invite into your data room. Some providers also permit you to purchase licenses on per-user basis. This could be beneficial for businesses who plan to use their data room for more than one project.