Important Document Management Functions in Virtual Data Rooms

Using a virtual data room (VDR) makes document management smoother, quicker, and more secure. Whether you’re working on an M&A deal or cooperating with a fellow legal professional, a VDR lets you share, edit, exchange, and create sensitive documents with high data security, all with just an electronic device and access to the internet.

What’s more, extended VDR features such as Microsoft Office integration, bulk uploading, and restricted viewing let you manage your data in a matter of minutes, from wherever you are. 

In this article, we’ll focus on the main features available for document management in virtual data room platforms. You’ll learn how each feature makes working with data easier and what to look for when you’re choosing the best virtual data room.

Data security

Virtual data room security is one of the primary reasons for choosing a VDR over other document-sharing platforms. After all, whether you’re working with an M&A, IPO, or capital raising, it’s essential that your documentation stays secure.

Look for the following features to ensure high-level data protection: 

  • Document watermarks. Custom watermarks show you the date and the name of the person who downloads the documents, which dissuades information leaks and data breaches. 
  • Device verification. This reduces the risk of data compromise when a user logs in from a new device. 
  • Different levels of access. Virtual data rooms let you create groups with different authorization access levels for a project’s documents. 
  • Two-factor authentication. This strengthens your data protection by asking users to enter a password and verification code sent to their phone when logging in. 

These VDR features heighten your data security and reduce the risk that a third party can tamper with, leak, or destroy your crucial information. 

Data control and reporting

Typically, multiple users will be responsible for modifying and organizing the documents in your VDR. Take M&A deals or joint venture investments, for example. In both cases, several or even dozens of employees will be working with the same documents. This is why access control and authorization rights are important. 

A virtual data room with the following features will help you distribute document management between employees and control their actions: 

  • Document change management. With this feature, you can track and monitor changes that users make to documents in a VDR. 
  • Notifications. The VDR software should automatically notify you when someone changes, uploads, or downloads documents. 
  • Data room reports. On a large project with multiple team members, it can be hard to track changes manually. With reporting, a VDR timestamps every action on every document and sends regular reports to the room admin. 
  • Restricted viewing. This hides your sensitive data from users that don’t have the authorization to view it. Only specified parts of a document are visible, and the rest are blurred. 

VDRs with these features mean you no longer have to worry about accidentally releasing sensitive data to the wrong employees or third parties.

Convenience of use

A virtual data room can have many advanced features, but these are useless if they aren’t intuitive. In addition, lawyers, M&A professionals, research assistants, and more may need to use your VDR, so it has to be intuitive and user-friendly for people with different tech skills. 

When choosing a VDR, request a demo or get a free trial and look for the following features: 

  • Drag-and-drop functionality. With drag-and-drop, you can select a file and drag it to another window with one mouse click. When frequently uploading many files to a VDR, this comes in handy. 
  • Multiple format upload. With this feature, the VDR accepts files in different formats and automatically converts them, allowing you to view documents from any device or browser. 
  • Microsoft Office integration. This feature synchronizes the documents on your device with the VDR. With Office integration, it takes only a moment to access, store, and transfer documents from Word, Excel, or PowerPoint to your data room. 
  • Multiple device support. Your data room should be supported on all major platforms and devices. This allows users to access the necessary documents whenever they need them. 

The ideal virtual data room should also be quick to set up, have an intuitive interface, and require a short learning curve. So how do you know whether the VDR you’re looking at meets these criteria? The solution is to request a demo or free trial to see the platform in action.

Time savings

A VDR is convenient, but it should also save you time. When you have hundreds of documents and files to store and manage, you need to do it quickly and efficiently. Less paper and faster management can, for example, speed up your M&A due diligence process. 

The following VDR features optimize operations and increase time savings: 

  • Bulk uploading. If you need to upload dozens or hundreds of documents at once, it’s much better to do it as a bulk upload. There’s no limit on the size or number of files, and it takes only a few moments. 
  • Labeling. Labels help you organize your files into categories and simplify file searching. 
  • Automatic index numbering. This feature automatically numbers documents and folders as you upload or reorganize them. 
  • Scroll-through document viewing. This feature is handy if you need to scroll through hundreds of documents in one sitting. With scroll-through viewing, you can go directly to the next document in the list or directory without going back to the folder and choosing the document. 

In summary, by saving time with a VDR, you and your employees can manage documents faster and concentrate on other tasks. 

Summing up

Convenience, time savings, control, and data security make a VDR a user-friendly and secure environment where you can manage sensitive and important documents. However, not all VDRs are the same, which is why it pays to check that your planned solution has all the features you need.

When choosing a data room platform, keep an eye out for drag-and-drop, bulk uploading, restricted viewing, document watermarks, and the other features covered in this article. With these things in mind, you’ll be well on your way to choosing the best VDR for you.