What is a Data Room?

A data room is an electronic storage system that allows documents to be stored in a safe environment. It also comes with a range of additional features to assist in the due diligence process. These features include annotations tools and granular access rights, watermarking, and activity tracking.

The most common use of a data room is to share security documents (SOC 2 documents and compliance certificates, etc.) with clients to assist in the due diligence process. This is a great method to accelerate the process and reduce risk by sharing this information with other parties prior to the close of the deal.

Traditionally, companies have utilized email to share SOC 2 documents as well as other documentation. This isn’t only inefficient, but also leads to problems with the control of version. It’s also unsecure, with cyber-attacks increasing, resulting in compromised inboxes, stolen credentials, and attacks on phishing.

Many secure storage and file sharing solutions such as Box or Dropbox offer document availability on any device and at any location. They offer a high degree of security, but most people and businesses require more. Important documents used to conduct due diligence, fundraising or negotiations must be stored and shared in software that has more security levels than these personal file-sharing systems.

The most important question to inquire about any “secure data room” is whether it prevents authorized users from sharing files with unauthorized people. Unfortunately, the answer is almost always not. Most’secure data rooms’ do not limit http://www.datazoning.net/how-to-choose-data-room-software-for-ma-risk-management the number of times the same user’s credentials can be used to access the system. It is simple for users to re-use logins from their own devices or simply copy and paste the URL into a browser on a friend’s computer.