A data room is an online repository that provides a better method of sharing documents and files than email. Most commonly used during due diligence during an M&A and M&A transaction, it can be useful if a business is sites looking to attract investors or perform other project-based work that requires strict confidentiality.

In M&A tendering, fundraising, and restructuring projects, there is usually a lot of confidential information shared between various parties. It is often difficult to determine who has accessed which information, which versions are in use and when modifications were made. With a data room all the required information can be stored in one place, and access managed by an administrator. It’s a great solution to avoid sharing that is not authorized and to ensure compliance.

Alongside storage, there are a variety of other features that are included in the majority of virtual data rooms. Drag-and-drop, bulk uploads, optical character recognition (OCR), dynamic watermarking and an advanced search feature can assist you in finding documents fast.

Most data rooms offer redaction tools in addition to these options. These tools permit users to selectively block parts of a document, without breaking the entire file. This is especially useful to avoid accidentally missing sensitive information in the document, which could have a major effect on the outcome of a deal or project.