A data room is a kind of virtual storage solution that offers secure storage for documents. It also comes with a host of features that assist with the due diligence. These include annotation tools and granular permissions, as well as watermarking and activity tracking.
Data rooms are often used to provide security documents to clients (SOC 2 documents or compliance certifications) in order to facilitate due diligence. Sharing this information with other parties prior to the deal is closed is a great way to speed up the due diligence process and lower the risk.
Traditionally companies have used email to share SOC 2 docs and other documents. This isn’t just inefficient, it also causes problems with version control. It’s also http://www.datazoning.net/beats-studio-buds-review unsecure, with attacks on email increasing, resulting in compromised inboxes, stolen credentials, and attacks on phishing.
Many secure file-sharing and storage options like Box or Dropbox allow access to documents on any device and in any location. Although they offer a decent level of security most companies or individuals need more than this. Documents that are sensitive and used to raise funds, due diligence or negotiating agreements must be stored in software with higher levels of protection.
The most important question you should ask any’secure data room’ is: does it restrict authorized users from sharing documents with non-authorized users? Unfortunately the answer to this is almost always not. Most’secure data rooms’ do not even limit the number of times the same user credentials can be used to access the system. It’s easy for users to use logins on their own devices or simply copy and paste the URL into the browser of a friend’s computer.
