Data rooms are a place where businesses can securely store confidential information. Although data rooms can exist in a physical location, there are also virtual data rooms (or VDRs). These online software programs allow you to securely store your company’s most private information.
The main benefit of these “rooms” is that they allow you to keep your company’s sensitive information secure while also making documents shareable to those who need to gain access to them. Let’s take a closer look at five ways data rooms keep business information secure.
1. Data Rooms Protect Client Data
Some businesses still use databases, which are prone to security breaches. The main advantage of using a data room or a secure virtual data room is that they are protected using access control settings specified by the document’s owner. Virtual data rooms are essential for business transactions where confidential client data must remain secure.
Additionally, having a system in place that prevents data leaks from occurring can help you build client trust. Clients are more likely to feel safe about having their data stored if they know there’s no risk of their credit card, social security number, or other sensitive information being leaked.
2. Extra Security Measures Keep Information Secure
Businesses who do choose to use physical data rooms generally hire security guards to watch over them. This prevents people from breaking in and obtaining information you don’t want shared.
Many companies opt to use VDRs rather than physical data rooms. Storing your company’s information virtually allows you to save money on physical space, which will save your business money in rent. Those who choose to use VDRs will generally opt for additional software support, or they may even choose to hire an IT specialist to ensure their data is kept secure.
3. Limited Access Helps Ensure Your Business’s Info Stays Secure
Regardless of whether a company opts to use physical data rooms or digital data rooms, there is generally only a limited number of people who access them. For example, a law firm might only allow senior lawyers to have access to data rooms. Or the data room might be limited to CEOs and vice presidents. Limiting access helps further ensure your business’s information stays secure.
4. They Help When Partnering With Other Businesses
Are you thinking of selling your business? Or maybe you want to take it to the next level and partner with another company. In these situations, another company is going to need to access information about your business to decide if they want to complete a deal with you. This, like many other things, can pose a threat to the confidentiality of your business.
One of the biggest concerns in this situation is another business being able to access — and use — confidential client data. The last thing you want is for a competitor to gain access to your client list. Physical DRs and VDRs can help prevent this from occurring.
Data rooms are commonly used when a business is dealing with mergers and acquisitions. It’s a great way to ensure your company’s information stays secure and doesn’t get stolen or leaked.
5. They’re Ideal for Company Audits
If your business takes part in any fundraisers, you might find yourself in a position where an organization will need to do a routine audit of your business. Although this is all a part of fundraising, it might be daunting to allow someone to access your company’s financial reports and other important details about your business. This is another situation when a data room can help ensure your business’s info is secure.
These are just five ways data rooms keep business information secure. Whether you have a large or small business, you might want to consider investing in a data room to help ensure confidential information stays confidential.