What is a Secure Data Room?

Secure dataroom is an online collaboration platform that speeds up due-diligence and reduces the timeframe for M&A and deal making while offering complete security. It allows sell-side and buy-side teams to handle the full process from beginning to end with confidence.

What is it that separates a secure dataroom from other file-sharing sites like Dropbox is the fact that it’s geared toward the enterprise, with the ability for users to be divided into groups and permissions to be defined at a granular level. Analytics can also provide insight into the use of the dataroom (e.g. the time, date and location your data is accessed). Many also have more sophisticated features, such as the ability to prevent the downloading and copying of data (a big no no) or even display documents on a screen that cannot be scanned. Many companies use industry-leading encryption technology to scramble sensitive information and multi-factor authentication in order to ensure that the user trying to log in is actually the one who is trying to gain access.

Most secure data rooms also allow document download for offline viewing in PDF form. If you permit users to print on physical printers, or save the documents to file drivers to use for other purposes, they will lose the security applied to the original data in the virtual data rooms.

If you can download the files from a data room or other system and then open them without having access to the Internet is not a good idea. This is not what you want from an online data room to save sensitive documents for M&A due-diligence, litigation compliance and other documentation that is sensitive. These documents need to be kept on devices, not transferred to servers. This is why we suggest using a DRM solution that encrypts files data rooms to devices rather than to servers which makes it impossible to remove them from devices or share them.