The global virtual data room market was valued at $2.37 billion in 2023 and is expected to reach $13.22 billion by the end of 2032. The current and projected statistics indicate the role of data rooms in boosting business security measures and ensuring compliance.
If you’re unsure how your business can benefit from data rooms, you’ve come to the right place. Let’s take a closer look at the benefits of data rooms:
Advanced Security
According to The Economist, “the world’s most valuable resource is no longer oil, but data.” Protecting sensitive information against breaches and unauthorized access is absolutely necessary. Virtual data rooms help you do exactly that.
Data rooms are secure online repositories designed for storing and sharing sensitive documents. They act as central hubs for all information, eliminating the need for traditional file-sharing methods. Other security features, such as watermarking, encryption, and access trails, also prevent unauthorized distribution of data.
Access Control
An access control system protects confidential information as well as intellectual property. Data rooms offer numerous features to ensure robust access control. This includes:
- Role-based permissions – administrators can assign predefined roles (viewer, collaborator, editor) to users, preventing unauthorized changes.
- Granular access permissions – business administrators can give specific permissions to individual users and teams.
- Multi-factor authentication – data rooms require a user to prove their identity or access through multiple steps, such as SMS, passcodes, and authentication apps.
- Real-time updates – administrators can get real-time updates regarding who has accessed information and what changes have been made.
For instance, data rooms are often used in mergers and acquisitions (M&A) transactions, where multiple parties (buyers, sellers, and advisors) need to view information to close a deal.
Easy Setup
Reliable data rooms have user-friendly interfaces and tools that simplify installation and setup. Employees don’t need extensive technical training to use a virtual data room and ensure business efficiency.
Look for the following features:
- Drag-and-drop functionality
- Customizable permissions
- Template creation
- Automated indexing and search
- Digital Rights Management (DRM)
Data room providers also ensure 24/7 customer support so users don’t have to deal with extended downtime.
Improved Efficiency
Sifting through a pile of documents and uploading them to the cloud is a time-consuming process. It reduces productivity and impacts overall business efficiency. Virtual data rooms can alleviate some of the burden.
With a data room, you can easily scan, upload, and retrieve documents. For instance, before a board meeting, administrators can upload confidential meeting materials, reports, and voting documents. Both internal and external stakeholders can review information, ensuring due diligence.
Cost Savings
Investing in a data room may seem like an unnecessary expense at first, but the benefits can outweigh the costs. With data rooms, businesses don’t have to worry about physical storage and document management. It will reduce the costs of data backup and retrieval.
Pharmaceutical companies, real estate firms, and corporate organizations can expand operations without worrying about rising costs. Many industries use data rooms to ensure regulatory compliance regarding confidential data sharing. This can also reduce the possibility of legal fines and penalties.