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VDRs are made to speed up due diligence and transactions with minimal waste of time

The due diligence that precedes a merger and acquisition process is a complex task that can drag on for an unknown time. Organizations must provide critical data to a group of previously unidentified individuals for the deal to move to the next stage. So, in addition to all the complexity, a transaction carries a lot of risks. But virtual data rooms for due diligence allow this operation to be activated and accelerated while protecting the data securely. This article will explain the merits of VDRs in the due diligence process.

The role of VDRs in due diligence

The original purpose of the virtual data room from its launch was to provide services for due diligence and M&A and only later expanded to other types of transactions. However, the M&A process is still the most frequent use of VDRs, which shows that the developers got their way, and their product now provides incredible value in the marketplace. But what made it happen? Due diligence is digging deep into a huge amount of sensitive company data. In the past, stakeholders had to come directly to the office with a physical repository of all these documents to conduct this process. With the advent of the Internet, business leaders realized that storing data digitally was much more convenient: it didn’t take up much space and was easier to search and share. But the Internet is full of dangers, and not even every data storage tool can be secure enough for corporate data. The data room due diligence allows you to upload and store any documents within the space and to collaborate, communicate, and conduct more efficient and faster verification.

Why are data rooms useful for due diligence

VDRs provide value for due diligence, particularly because they:

  • Provide users with secure document storage

Store any data in the VDR space, from employee information to intellectual property, without risk. Data rooms offer military-grade security features, so encrypt your documents during transmission and storage and secure login with dual authentication. In addition, room administrators have full authority over invited users’ access to other documents. They can give and revoke access to a record at any time and prohibit copying, printing, downloading, forwarding, editing, and screenshotting the document.

  • Provide interested users with easy collaboration

Neither you nor your potential clients need to leave the walls of your office to conduct the due diligence process or even to sign a contract. Invited users have a centralized space they can access from any location and device. This allows for better assessments in a shorter amount of time. In addition, established two-way communication improves transparency between the parties, allowing integration planning to begin early in the transaction.

  • Removes unnecessary work

Quality VDR providers allow you to automate many routine processes, saving you valuable time. For example, you can automatically upload, categorize, and convert files when organizing data. In addition, the text search will allow you to find the document you want with a single word or phrase. You can also set up automatic notifications of any updates within the VDR, such as a new question or a change to a document.

  • Make data easy to analyze

Artificial Intelligence features help analyze files and improve workflow and data organization. It also makes it easier to adapt to new information and change data. VDR provides detailed reports on user activity in documents, allowing you to determine which party is more interested in the transaction.

Choosing a legal practice management software provider

Today VDR software provides opportunities for the complete systematization of all production processes in a law firm. In this article, we are going to discuss basic recommendations for choosing a legal practice management software provider.

Virtual data room for legal practice management

Document management is the most important component of the activity of any legal company, which allows accounting and systematization of incoming business, administrative and current documentation. The coherence of the work of the entire company depends on a well-organized file-sharing system.

Legal document management is associated with a whole chain of work with documents, including their creation, approval, sending, receiving and storing. Violation of at least one of the points can significantly affect the company’s activities. The automation of such procedures will streamline document flow, reduce costs and protect against reputational and legal risks. Thus, nowadays most legal organizations implement SaaS services like virtual data room (VDR) for systematization of information and organization of collective work of lawyers.

VDR is a secure cloud-based platform that ensures digital data warehouses and a set of collaborative tools for efficient management. Data room for legal practice management will allow:

  • carry out the competent movement of documentation along the shortest path at minimal cost
  • control the passage of the document with the fulfillment of tasks within a strictly established time frame;
  • systematize the registration and accounting of all incoming and outgoing information;
  • archiving documents;
  • provide a secure collaborative environment.

Why do legal companies choose VDR?

Today most legal firms choose data room following the next reasons:

  • The VDR document management system provides for the possibility of certifying information carriers with a special electronic signature and then encrypting them. This allows you to check whether the information is genuine, as well as find out who the author of the file is. In addition, thanks to the use of electronic signatures, the storage of documentation will be secure.
  • With the help of the data room deal management automation, you can track the progress of office processes, starting from the work of the performer at his workplace and ending with the transfer of the processed document to the archive. This allows you to find weaknesses both in the work of personnel and in the workflow itself.
  • VDR automation will minimize the cost of searching for a document, reducing the loss of working time by more than 30%. And you can simply forget about such a phenomenon as the loss of information with electronic document management.
  • You can search in the VDR database not only for a specific document but also for certain sequences. Search options are limited only by the imagination of the company’s employees and the competence of the staff of the electronic document management system.

How to choose a reliable data room provider?

The modern VDR software market for legal practice management offers different alternatives. There are various characteristics of systems that allow computerization of management processes, according to which they are classified:

  • applied technologies of office work;
  • functional characteristics;
  • compliance with key business objectives;
  • software implementation;
  • price.

Here you need to identify the main tasks and determine the importance of each of them. Often the goal is to increase the transparency and manageability of processes, but this can be done without office automation. It is recommended to divide each task into several local ones. It will not be possible to achieve an increase in transparency quickly, but it is possible to set a shorter term for agreeing on contracts, as well as to view a report on the labor costs of a specialist for the implementation of each project in real-time.

iDeals vs Datasite (formerly Merrill)

Virtual data room has become a collective image of all automation and process management solutions. In this article, we will help you understand which software features you should pay attention to while comparing iDeals vs Datasite.

The functionality of digital data room

Virtual data room (VDR) is a full-featured software for integrated document and business process management; focused on enterprises and organizations of all sectors of the economy, whose activities involve a complex technological process and many participants in a geographically distributed structure.

With a wide range of functions, data room software allows you to cover all the processes of document management and corporate governance. The system fully automates work with incoming, outgoing, and internal documents, orders, business processes, and archives. Thus, support is provided for the life cycle of the document from the moment of creation/receipt to destruction/transfer to the archive.

The principle of VDR software is as follows:

  • The document management module helps to conveniently create new files, register incoming and outgoing documentation of the enterprise, as well as control document flow – the movement and history of changes to any files.
  • An electronic vault is a secure space on an organization’s server used to store documents and attachments. The functionality of the storage allows you to organize a hierarchical catalog of documents for easy search and classification of files, as well as the creation of a complex system of independent backups for important documentation.
  • The module for working with orders simplifies the assignment of tasks to employees of the enterprise for office work. The program contributes to the optimization and complete control of the movement of documents within the company, as well as setting instructions and coordinating personnel. The functionality of the module includes extensive tools for setting up scenarios and routes for the movement of external and internal documentation, as well as accompanying files.

iDeals vs Datasite: what option to choose?

iDeals and Datasite are perfect alternatives for every business in different economic sectors. Both solutions are used in corporate structures of various scales. So, let`s analyze what are the differences between them and which one will be more suitable for your company.

  • iDeals

iDeals data room offers companies an online data repository and enables them to exchange data with customers and business partners in a controllable environment. With shared drives, businesses can create and share files from anywhere in the world and can automatically sync across all devices used by the business. The company can allow multiple users to access and edit files, but with limited control over everything else. This software helps to store sensitive information related to the sale of the company and to provide all buyers with equal access to information.

iDeals guarantees the stable operation of the electronic storage and protection of the enterprise’s confidential data and allows you not to change processes when changing personnel. This favorably distinguishes the system on the market and contributes to the automation of the company’s documentary turnover at the lowest cost for the implementation and support of FIS modules.

  • Merrill DataSite

Merill VDR streamlines the due diligence process and is a highly efficient method for exchanging critical business information for due diligence electronically through a highly secure online clearinghouse that can be accessed over the Internet. The software provides complete control of security settings that are assigned to a particular user by the client, based on the user’s role in the transaction. Merrill services include document and information management, litigation support, language translations, execution, imaging, and printing. This VDR serves clients in the corporate, legal, financial, insurance, and real estate sectors.

Do I Really Need a Virtual Data Room?

In modern business, it is very difficult to imagine a company that would not try to automate work processes as much as possible. In this article, we will analyze the necessity of using data room software for the automation of a company`s deal management.

The purpose of using virtual data room

According to Forrester Research, 38% of Fortune 500 companies believe that implementing a modern virtual data room is critical to the success of their business.

The main source of information in any organization is the documents that are created and exist as part of business processes. Content appears at different stages of work: at the beginning (agreement of a contract, application for a vacation) or the end (issuance of a certificate, preparation of marketing material). If routine operations take up a significant part of the time, and finding the person responsible and determining the stage of the process is a whole quest, then these are the right signals for the introduction of a digital deal management system like virtual data room (VDR).

The VDR solution will help:

  • Get a standardized database of contractors common to the company.
  • Effectively control the quality of the work of the sales department at any time.
  • Get statistics and analytics on the effectiveness of deal management.

Data room system is software for working with electronic documents at all stages of their life cycle: creation, editing, storage. Modern systems support document routing capabilities and, of course, basic functions such as search, classification, and so on. Documents and business processes are inseparable, so modern automation systems should include a set of tools for working both in the field of processes and in the field of information.

What are the advantages?

When implementing VDR, it is important to understand that its main purpose is not to save consumables but to organize a modern and high-quality management structure, control, and analysis of the company’s business activities.

So, let`s analyze the main VDR benefits:

  • Quick access to a specific category of documents. The first and main advantage of the data room document management is the quick, almost instantaneous access of a certain category of employees to information determined by certain restrictive frameworks. The user can quickly and easily find only those documents to which he has personal access.
  • Comprehensive document control. Any document entered into the VDR system gets its history. All operations with it, all employees working with this document, are recorded in special registers and stored there for an arbitrarily long time. Now the manager has effective control over the deal
  • Automation of reporting. Automation of office work and deal document flow is another indisputable advantage of the VDR. It allows you to automate the process of compiling reports on the operational, tactical, and strategic activities of the enterprise. The department will be able to generate a report according to any objective criteria: the number of documents involved in processing, the number of documents in the queue for each employee, etc.
  • File-sharing and document collaboration. The deal workflow automation makes it possible to organize only one database, which will contain all the documents necessary for the operation of the enterprise. In addition, this will allow several employees to work with one document at the same time, which significantly reduces the time spent on its processing.
  • Elimination of errors. Practical exclusion from the workflow of the so-called “human factor”. Unlike paper workflow, cases of inadvertent loss of documents or their placement in inappropriate places are excluded. This saves a huge amount of time across the enterprise when searching for the right document.