The use of a virtual data room doesn’t have to be restricted to certain industries. Virtual data rooms are used when a business has to exchange confidential documents with other parties. This could be as a result of a merger, acquisition or IPO or any other type of business transaction that requires the exchange sensitive documents. In certain instances this information is required to fulfill regulatory requirements like when a firm needs to provide access to auditors and regulators for a review of company records.

Virtual data rooms are employed by a variety of firms to simplify due diligence in M&A transactions. Due diligence can involve many documents that needs to be viewed by many interested parties. The ability to quickly browse and download the documents in a VDR allows the process to proceed faster and more cost efficiently.

Other businesses use VDRs for other purposes. VDR to facilitate sharing documents with lawyers, clients and third parties for legal or regulatory reasons. For example, a law firm may require access to the records of a client and must do so in a secure location to ensure that it is not in violation of privacy digital storage in business operational capability assessment laws.

A VDR allows businesses to automate workflows, processes and approvals. This will reduce the time and effort required to manually complete tasks like signing an NDA, managing invoice approvals, or submitting files for upload into a data room. In addition a VDR that has advanced document processing features can search the text in most file types including PDFs and Excel documents.