How to choose the Best Virtual Data Room Provider

Clear up the critical aspects of virtual data room comparison and make an informed decision.

May, 2022

4.9
Capterra G2
5.0
iDeals virtual data room is an ultra-secure industry-leading solution featuring over 100 options for the entire workflow and data protection. Thus, the platform is ideal for data storing and exchange, as well as collaboration and governance. The biggest strength of iDeals is its robust document security. Besides, this online data room provider offers a 30-day free trial.
  • 30 days of unlimited usage
  • Live 1-on-1 demo with an expert
  • Data room setup assistance
  • Complimentary training
  • 24/7 email & phone support
  • Price quote based on your requirements
Ease of Use
9.6/10
Ease of Setup
9.9/10
Ease of Admin
9.3/10
Quality of Support
9.8/10
4.7
Capterra G2
4.6
Intralinks virtual data room offers an intuitive interface, user-friendly mobile app, and 24/7 proactive customer service. The VDR provider also delivers tremendous assistance during the M&A life-cycle. The official website of Intralinks virtual data room services does not include information about a free trial, but you can request a demo.
4.7
Capterra G2
4.3
Datasite is an online data room software with solutions for due diligence, deal preparation, marketing, M&A, etc. What is more, Datasite provides each client with a personal project manager to ensure efficient data room use and support. The free trial is available for 90 days.
4.3
Capterra G2
4.2
Box data rooms are a simple tool for secure data exchange and collaboration that is easy to use despite complex privacy mechanisms. Therefore, the Box virtual data room is suitable for remote document access and cooperation in a safe online environment. The free trial is 14 days.
4.1
Capterra G2
3.9
Virtual data room provider Donnelley has years of experience dealing with transactions. The product also includes automated systems, artificial intelligence, and functions for predicting user actions. All this optimizes document workflows and therefore attracts different industries. There is no information about the free trial on the official website.

Some potential users may think that choosing the best virtual secure data room is challenging. It isn’t surprising since there are many solutions in the rapidly developing and highly active data room industry. Thus, each virtual data room provider has specific approaches regarding the feature set and the customer service quality. As a result, a client needs to compare many parameters to choose the best data room.

What are virtual data room providers?

A virtual data room provider, also called a virtual deal room provider, is super-reliable storage equipped with security mechanisms. However, this is not the only advantage of the platform, as there are dozens of features for collaboration, digital rights management, and workflows. Moreover, it is a reliable system for monitoring the employees of an organization since virtual data room providers offer special functions for this.

Virtual data room service is popular across industries, including financial institutions, investment banking, law firms, healthcare, biotech, real estate, startups, and many more. In short, virtual data rooms software is popular with everyone who needs strong data protection, user control, and productive collaboration.

What makes virtual data room software different from others?

A data room is distinguished by high-quality protection of the client’s privacy with the help of special functions and compliance with international data protection standards. However, there are more benefits:

  • One of the most important advantages is providing round-the-clock access to data. It is worth noting that the level of access security does not depend on the device used or the user’s location. So, most data room service providers offer mobile applications to customers that are convenient and, most importantly, secure. In addition to access, you get instant messengers, which are also covered by security features.
  • Another distinctive feature of the software is the provision of technical support. This team of professionals helps in cases of technical problems and at the stage of data room installation. Some providers have experts ready to facilitate the client’s transaction with professional advice and assistance. Some help desks are open 24/7, others during business hours, depending on the provider you choose. The more accessible support, the less likely the data room client gets into trouble.
  • Another thing worth highlighting is the free trial service. This is a period when the client can test the data room and see if it suits the organization. Unfortunately, not all vendors offer a free trial.

Why choose virtual data rooms?

The main thing to highlight is the difference in data security. When it comes to this issue, a virtual data room is more trustworthy. It is easy to explain since data rooms are designed for business, unlike other programs.

Other cloud solutions are like self-service, in which the user takes full responsibility for protection. In addition, these products do not offer a wide range of permission control features. Therefore, when you give someone access to data, you rely only on honesty.

When it comes to virtual data room software, the provider takes responsibility for data storage. In addition, the client also has tools for managing permissions, activity reports, watermarks for tracking confidential documents, and much more.

What benefits do virtual data room providers offer?

The best virtual data room benefits small, medium, and large businesses regardless of industry. After all, all these organizations strive to simplify the entire time-consuming workflow, strengthen security, and establish practical cooperation inside and outside. So, data room vendors are providers of the following benefits:

  • Prevention of leaks and hacks. A modern data room must have mechanisms to protect against all hackers’ tricks as they also become more proficient. Fortunately, unlike insecure cloud storage, virtual deal rooms are not vulnerable to attacks. Data encryption, a unique authentication procedure, remote data access control, virus scanning, and other options eliminate the possibility of hacks or leaks.
  • Deal improvement. Detailed audit logs are a way to track data and users. What’s more, it is an excellent method to collect analytics on investors and buyers. In this way, the owner of virtual data rooms receives valuable insights, having information about the documents viewed. So, directors focus on serious partners, not wasting time on uninterested parties. It greatly improves the entire deal process.
  • Deal Acceleration. The ability of virtual data room software to optimize processes positively affects the course of the transaction. After all, the collaboration platform has everything you need to create, study, edit, share, manage data. In addition, the integration of some VDRs with Microsoft Office, Zoom, Teams, and others makes the tool even more versatile and accessible to all users. In short, secure data rooms eliminate the need to find safe ways to work with data, collaborate, and travel.
  • Minimum human error. It is a common problem that seems complicated to solve, but this is not the case with virtual data rooms. This tool offers maximum options to minimize human error. Because administrators set strict access levels, there is no way for users to make a random mistake. For example, they cannot accidentally upload or share a confidential file without having access to it.

What are the most common use cases for a virtual data room provider?

Considering the security of virtual data room service and its powerful operating capability, a potential user can conclude that this tool is multitasking. It is also worth noting that the developers considered the needs of modern business in deal-making, daily workflows, and management when creating the product.

M&A and due diligence process

These complex deals are one of the most common reasons customers turn to virtual data room providers. It is because mergers and acquisitions require a lot of time to review and verify dozens of documents. Another difficulty is in securing this deal-making process. Thus, M&A participants receive a reliable environment that makes the transaction easier through security mechanisms and valuable features. One of these is closing data room access to the other party if something goes wrong.

Fundraising

It is one of the critical steps towards corporate development. But unfortunately, many directors have experienced firsthand that working with investors can be difficult. Virtual data rooms in fundraising are a decisive advantage as investors are more willing to accept convenient collaboration through the platform. Virtual data rooms simplify file sharing and improve control and oversight, which benefits fundraising deals.

Initial Public Offering

This deal requires companies to comply with specific rules and regulations. In addition, an organization must become transparent to shareholders and the public. Virtual data rooms offer the necessary transparency, secure cloud storage, and management tools for all parties to the transaction to survive IPO.

Audits

This use case relates to meeting the need for companies to share data. They often have to share sensitive data with outside parties, and it is essential not to expose it to the risk of leakage. Thus, directors can safely share corporate data with accountants, legal advisers, and auditors through a secure data room.

Board collaboration

A virtual data room makes remote collaboration as comfortable as possible. Of course, directors do not always live in the same city or even country, but in such a case, the platform becomes a secure online office with all possible facilities. In addition, the council has instant messengers with private and group chats, tools for voting and polls, and shared secure access to confidential data. 

Intellectual property management

Organizations that do not provide adequate protection for patents, trademarks, licenses, trade secrets often suffer losses. Since virtual data rooms provide ultra-secure document repositories for such sensitive documents, customers often benefit from digital rights management tools to protect their intellectual property.

Real estate transactions

Real estate agents enjoy the convenience of data-rich operations and tracking tools. So, agency workers can exchange documents in different formats, including videos, drawings, and photos to improve real estate management. Also, they track the activity of potential buyers and select the best partners for cooperation.

How to compare virtual data rooms?

First and foremost, your team should determine what they need to significantly streamline workflows. In this way, you can narrow down the list of suitable virtual data room providers, discarding those that do not meet your requirements. Immediately after that, you can start comparing virtual data room solutions based on the following points:

Features and ease of use

These parameters are critical, as they determine the user VDR experience after implementing the data room software. First, the best data room features must fit perfectly with your requirements. Secondly, the virtual data room solutions should not make the interface complicated. 

Unfortunately, some software has a lot of options, which negatively affects the ease of use. By the way, the free trial period offered by some data room service providers is a good way to see if the platform is user-friendly.

Virtual data room pricing

Virtual data room vendors price their services differently, which can be confusing. However, the choice of suspiciously cheap tools is not reliable and may have irreparable consequences for the client’s security. To protect yourself from this, check the privacy guarantees, availability of technical support, consulting services, and free trial. If any of these points are not credible, it is better to consider other data room offers. 

What else do you need to know about virtual data room pricing?

Before applying for a free trial period, figure out what the provider is based on when pricing.

Number of users

As a rule, the price depends on the number of users requested by the client. It is also worth considering that some data room vendors charge a considerable fee for each additional user, reaching up to $ 100. Calculate the number of persons who will work on the platform as accurately as possible. This will help you avoid additional expenses in the future.

Storage size

The cost of virtual data room solutions also depends on the storage size. And when it comes to this point, most providers choose the same approach as with the number of users–if you need additional gigabytes, you will have to pay. However, it is also possible to calculate the approximate required cloud size to not overpay for extra gigabytes. Moreover, installing data room software for a small project makes it easy to estimate the required storage size. Evaluate the document flow for a project or deal to inform your VDR provider of your storage requirements.

Features

Data room providers usually offer several tariff plans that include different features, which affects the cost. By the way, some tariff plans do not include a free trial period. To avoid a lack of features or overpay for unnecessary ones, discuss with your team each option and its benefits for your workflows.

What is flat rate pricing?

Some virtual data room vendors offer a flat rate. That is, for a certain cost, you will get access to the platform for an unlimited number of users and a certain amount of storage. The advantage of a fixed rate is that the client does not pay extra for certain virtual data room solutions, which is cost-effective. Carefully study and ask the data room provider questions about the features and services included in the flat rate.

Additional support services

The software installation and its further use may require assistance from the VDR provider. With it, the client feels safe in case of malfunctions or difficulties in work processes. So, ask your provider:

  • Is a free trial available?
  • Does your company offer assistance with setting up a virtual data room?
  • Are there any services for training and adaptation of beginners?
  • What are the customer support team service hours? What is the response time?
  • Can I order functions or extra storage after the data room installation, and if so, what is the cost?

Security

While the best data room providers are the epitome of perfect data protection, there are still a few things you should check before choosing:

  • What type of encryption do you apply? What data does it cover?
  • What compliance certifications does your data room have?
  • What is the authorization procedure, and does it include 2-step authentication?
  • Are there any tools for data management and access control?
  • What are the secure file-sharing mechanisms?

Virtual data room review

User reviews can be decisive for you, as providers are reluctant to talk about the shortcomings of their products. Therefore, visit review sites to learn about the solution and its advantages and disadvantages. As a rule, such websites do not cooperate with data room providers and contain only truthful reviews. But in any case, avoid sites marked “Sponsored.”

Checklist for choosing a reliable VDR provider

Here is a list of basic criteria you can rely on when searching. Note that the most essential is still a free trial. Responsible and conscientious online data room providers have nothing to hide. On the contrary, a free trial is a way to attract a client if the virtual data room is of high quality.

  • Experience and popularity in the market
  • Over 90% of user virtual data room reviews are positive
  • Data protection measures that comply with international standards
  • Experience in cooperation with both startups and huge corporations
  • The feature set that matches your team’s needs
  • Regardless of the client’s priorities, the provider’s focus is safety
  • Prompt processing of requests by technical support
  • Continuous improvements and the introduction of innovative technologies that enhance the user experience

What features should be in a secure virtual data room?

Even though we have mentioned the data room functions above, now you can explore them in more detail. This information helps you understand how each feature works, how it affects the user experience, and how it benefits the entire team. So, let’s check out the security, data management, and user control options.

Security mechanisms

The features below give you an idea of secure cloud storage from trusted data room solutions.

  • Scanning for viruses. Industries deal with hundreds of files daily and upload them to a virtual data room. Therefore, the program should automatically scan for viruses. Moreover, advanced mechanisms prevent the user from uploading a file corrupted by viruses.
  • Robust infrastructure. The best virtual data rooms are ready to provide 99.95% uptime in an environment protected from hack attacks and unauthorized actions within the company.
  • Operational data room security. This point refers to the protocols and codes responsible for secure access to confidential information. It includes access restrictions by time or IP, customizable login permissions, multiple layers of encryption, dynamic watermarks, secure access from mobile devices, remote data wipe.
  • Multi-factor authentication. It greatly reduces the risk of unauthorized authentication. The procedure works so that a user needs to enter a special code generated by the program. Successful login is possible only if the password is correct.
  • Disaster data recovery. The best virtual data rooms vendors have specific plans and secure measures to protect the storage contents in case of fire or flood, keeping sensitive documents safe and sound. It is noteworthy that confidential information remains available to owners anyway.
  • Physical data protection. These measures are equally important to protect the client’s privacy fully, so providers use physical security, ultra-reliable servers with uninterrupted power supply, and strict access rules.

Document management features

The functions described below make working with documents much more straightforward and completing tasks faster. Therefore, the more options an electronic data room provider has, the more benefits its virtual data room brings to teams.

  • Dynamic watermark. It may contain the date and time of access, the name of the owner, or the IP address. Watermarks are also a way to identify the source of a security breach.
  • Drag and drop upload. It is a fast and convenient way to upload data to the platform, which requires a few clicks.
  • Supported formats. The more document formats data rooms are compatible with, the more time a user saves. After all, you do not need to spend effort on converting data into formats suitable for software.
  • Automatic indexing. The platform provides easy navigation regardless of the number of documents by indexing files and folders. However, the system continues to do so if you add, remove, or change data. Therefore, there is no need to do it manually.
  • Version control. A virtual data room administrator can control user access to document versions and add comments or read the version history.
  • Electronic signature. Directors can approve documents without leaving their office with an embedded electronic signature. In some cases, before signing, a user has to verify their identity through a specific procedure to avoid illegal use of the signature.
  • Bulk upload. The best data rooms do not limit the number of bulk uploads. Therefore, you may upload multiple files in seconds.

User management and permissions

One of the main benefits of a virtual data room is controlling and tracking every user’s action. For example, an administrator can create groups based on their responsibilities and tasks. Each group works on the platform according to the set user permissions. In this way, some get full access to highly confidential documents, while others never see them.

The power of administrators does not end with defining access permissions because they can also easily track each group’s activities online. It helps to detect suspicious activity and illegal actions in time.

Significantly useful for this is the data room-generated activity log, which administrators can access on-demand or at a predetermined schedule.

Compare top virtual data room providers 

Security

After reviewing some common features of virtual data rooms, we compare the best virtual data room providers in terms of functionality, starting with security. After analyzing it, we get the following rating of the best platforms:


1. iDealsiDeals virtual data room has ISO/IEC 27001:2013 and SOC 1 and SOC 2 certified data servers. The approach to ensuring data integrity and file protection complies with the General Data Protection Regulation standards. What’s more, HIPAA compliance guarantees confidentiality for customers in the healthcare industry. As for information protection mechanisms, the data room offers all of the above, including 99.95% uptime, encrypted VPN tunnels, data transfer via Transport Layer Security protocol, and its storage with 256-bit Advanced Encryption Standard keys.

2. Donnelley Although Donnelley is inferior to iDeals, this trusted data room also has a robust infrastructure, virus scanning, 256-bit encryption, and General Data Protection Regulation compliance.

3. IntralinksIntralinks data room service boasts many audits on data center, application and human resource management, and source code. In addition, Intralinks provides 24/7 facility security and is ISO 27001 certified.

Document management tools

As for document management functions, iDeals virtual data room is again in the lead. However, less demanding organizations may take advantage of simpler platforms.

1. iDeals For data management, this data room has a drag and drop tool, automatic index numbering, over 25 supported formats, Windows Explorer integration, Optical Character Recognition, remote shred, watermarks, fence view, and more.

2. DatasiteDatasite offers automatic content categorization, bulk upload, data backup, watermarks, and a user-friendly advanced search engine.

3. Box Box data room solution uses auto indexing, desktop synchronization, VDR index export to Excel, and document version control.

User management and permissions

This set of functions is closely related to security, allowing administrators to control other users. Here is what the following providers have for this:

1. Box Box sets an expiration date on documents, which prevents users from unauthorized actions. Also, without the administrator’s permission, others cannot view, print, or share data. Moreover, there are granular access permissions, IP address restrictions, two-factor authentication.

2. iDealsThis service provider, in turn, offers detailed user permissions too, dividing users into four groups for easier management, bulk user invitation, and special permissions to view Excel files.

3. DonnelleyThis virtual data room has group and granular user permissions, making it possible to manage specific departments and each user individually. However, there are no settings for the expiration date.

Frequently asked questions

If the information above did not answer some of your questions, you might find them in this section. Here is what potential software customers often ask:

1. Is there a difference between data rooms and other programs? 

Yes. The difference is that data room providers prioritize security, efficiency, and ease of use. So, evidence that providers are responsible for these missions is a large number of clients worldwide. First of all, they value ultra-reliable security mechanisms that work for all industries and tasks.

2. What are the features of M&A data rooms?

The best solution for this task should be safe and easy to use. If any of these aspects do not work, the transaction may be complex. Also, look for data and user management features and activity tracking to control processes and always be in the know.

3. What is the use of a data room for M&A?

The platform automates tasks and facilitates file-sharing, in addition to the mentioned data protection mechanisms. This transaction makes parties exchange confidential documents, including trade secrets. So, the software can provide maximum privacy to multiple parties to the transaction.

4. Is there a difference between providers?

Yes. It is true because data room vendors have different approaches to customers and product development. Consequently, the most advanced are constantly creating innovative tools to become even better for the user. Unfortunately, some providers neglect security measures or other virtual data room services but put effort into marketing. This proves that potential VDR users should read reviews from independent sources to choose the best.

5. How to manage the platform in the best way?

Rely on three main principles – relevance, safety, convenience. So, as an administrator, you must ensure that the information in the storage is up to date, everyone involved has the appropriate permissions, and it is easy to restrict access to necessary documents

6. What is the importance of data room services?

The software may play a critical role in an organization because it offers dozens of options for successful business transactions and workflows. Thus, each participant receives an individual secure workspace with access to documents and tools for optimizing tasks. As a result, teams notice increased productivity and better results soon.

7. How long does it take to install software?

It depends on which data room you turn to. Some offer a dedicated manager who makes everything ready within a few hours. So, you can secure yourself with a reliable assistant in a short period, even during the planning period. If the solution’s installation is urgent for you, then make sure that the provider can assist in the preparation.

Before you leave

Finally, we remind you of the benefits that you get by installing software:

  • top-level data hosting security, for which the provider is responsible 
  • fast and secure data sharing with encryption
  • 24/7 data room remote access from anywhere in the world from your mobile phone
  • tracking the activity of employees, partners, potential investors
  • practical cooperation
  • optimized conclusion of business transactions of any complexity

Conclusion

This guide to virtual data room solutions is supposed to answer all the questions of a potential online data room customer regarding the product’s mission, functions, usage, free trial period, prices, benefits. If you have received answers to the most important questions, you are ready to make a deliberate choice of a provider.

Remember that the result of your transaction, work processes, and cooperation depends on it. Luckily, every potential user can request a free trial to see if the product is suitable for their industry.

However, taking into account the reliability and functionality of the data room, we can safely conclude that this is the best solution for everyone and everything related to convenience and security.