A secure data room is a cloud service specifically designed to store and sharing of confidential business data. It is used for M&A due diligence, IPOs and litigation, fundraising, and other sensitive document processes. It offers a greater level of security than file sharing services that are available online. The underlying server space is encrypted, which will stop hackers from gaining access to the content, and many also offer features like granular permissions search functionality, custom NDAs with a Q&A function, personal watermarking and multi-factor authentication.
However, these tools don’t prevent authorized users from making copies of the files to which they have legitimate access and then sharing those with others – something that can be quite easy to do. Also, these tools do not provide links that could reveal the source of illegal distribution.
This is why it’s important to businesses that are looking for a advanced method to store and share documents to consider the idea of a virtual room (VDR). VDRs offer a higher level of protection than email, Google Drive, and Dropbox. They accomplish this through advanced encryption, tracking features, and other security measures that make it impossible for users to copy and distribute protected documents. This includes dynamic watermarking that applies unique identifiers to each file like the email address of the person who received it and IP address to prevent sharing without authorization. A reputable data room, such as Digify, can also track who is viewing documents as well as how often they are viewed and for how long.