VDRs are a fantastic tool for companies that want to conduct due diligence, work with other organizations and protect their information. They are also useful for M&A, fundraising and IPOs. These tools are used by many law firms and financial institutions. However, they can be useful in other sectors. Life sciences and biotech companies, for example, need a secure environment in which they can work with customers as well as investors and technology companies require a place where they can save data in a secure and efficient manner.

Another industry that could benefit from a virtual data room is real estate, which requires huge amounts of paperwork and report exchanges. A virtual data room makes it simple for real estate companies to share accounts and audit reports with clients on an encrypted platform. The top VDR providers offer advanced security features to protect the confidentiality and privacy of files. These include redaction, which blacks out parts of a document to ensure personally-identifiable information remains confidential, and fence access, which prevents screenshots.

Finally the VDR can be beneficial for private equity firms, that are required to manage many M&A processes. As opposed to the simple file-sharing options like Dropbox or Google Docs that aren’t designed for M&A purposes in the first place, a VDR can provide secure collaboration and control of sensitive documents. The ideal solution is one that has a simple interface and robust integrations, as well as customizable permissions and granular auditing of user activity. It should also allow users to browse files in multiple formats and create notifications.