If you are searching for a virtual dataroom it is recommended to select companies that provide tools for managing users, security settings and reporting. The more advanced features the service provides, the better they are at addressing your needs and reducing the cost and time for due diligence.

A data room is a secure repository for hosting sharing and archiving business documents such as emails, notes, and more. They can be used to facilitate mergers and acquisitions (M&A) as well as joint ventures, fundraising and initial public offerings (IPOs) and legal procedures.

It’s important to check recent reviews on independent review sites prior choosing a provider. Check for testimonials that explain how well the software handles various types of documents, and if it can meet specific requirements for documents. Also, select a service that has both advanced and basic tools within one platform.

Investors can request documents as part of the due diligence process. These requests are usually executed in two stages. Stage 1 comprises information for a termsheet like your pitch deck, product/market fit, financial models, and a cap table. Stage 2 is the complete due diligence list that includes detailed information on the company’s documents, securities-related docs and material agreements.

The file permissions that are granular offered by many providers allow you to create multiple levels of access to the users you want to access. This is particularly beneficial in situations where you want to allow third parties to access your sensitive or confidential documents. You can, for instance set downloading and viewing what does a data room offer permissions for individual folders or subfolders. You can also edit these permissions as needed.