Data Rooms For M&A: 6 Main Reasons To Go Virtual Over Physical

A Virtual Data Room (VDR) is a digital space where you can store and exchange key documents. Modern data rooms significantly simplify and speed up mergers and acquisitions while providing enhanced security. Here are six benefits of using a virtual data room for M&A. 

data rooms M&A

1. Cost reduction

Compared to a physical data room, virtual data rooms are much less expensive. Moving M&A to the virtual space means cutting spending on accommodation, travel, stationery, and more. The parties involved can then direct the money they save towards other areas of their business.

Virtual data room pricing depends on several factors, such as deal type, company size, required features, and so on. 

  • Tip: Go with a data room that meets your expectations and works for your current budget. Upgrade or downgrade to a different plan later, if necessary. 

2. Ease of use

Experienced virtual data room providers know that deal digitalization might be challenging for some users. Therefore, data room developers do their best to layout intuitive interfaces and offer accessible support whenever possible.

  • Tip: Ensure the data room provider you choose has a multilingual VDR training program, so all users are up to speed before the deal starts.

3. Top-level security

A data room for M&A will contain highly confidential files. Advanced security protocols and features are key to establishing a safe and productive deal flow. Look for:

  • 256-bit encryption
  • ISO 27001 and SOC 1 or 2 certificates
  • At least 99.5% uptime
  • Multi-level access rights management
  • Time and IP restrictions

Advanced virtual data room security practices guarantee a safe deal environment and overall user integrity.

  • Tip: Use tools such as Fence-view and screenshot restrictions to protect the documents from unsolicited sharing and viewing. 

4. Time efficiency

It takes less than an hour to open a data room for M&A. Such rapidity is a great asset in the current climate of dynamic deal-making.

Since there is no need to physically relocate to access the data room, the M&A-related run smoother, and decisions may be made sooner.

  • Tip: Use pre-designed M&A checklists and templates to get the virtual data room up and running quicker.

5. User control 

Virtual data room administrators have complete control over all VDR users. During the setup, personnel can adjust access rights and permissions, establish necessary conditions, and distribute the users according to their role. 

And once the data room for M&A is ready, authorized personnel can monitor who, when, and for how long someone accessed a document.

  • Tip: Aligning access permissions with different M&A stages will help facilitate a straightforward and effective data room experience.

6. Global accessibility

A digital data room offers centralized, convenient access to all parties regardless of their location. Along with cost and time efficiency, such availability further benefits cross-country and international deals.

  • Tip: Consider the virtual data room providers that offer the most adaptability with various platforms and devices.

The best data room for M&A

Choosing a virtual data room over the physical one comes with extra security, efficiency, and accessibility. A good data room provider will find a way to accommodate your company’s unique requirements, making the use of a VDR even more beneficial.