How to choose the right virtual data room is a question with hardly a simple answer.
The data room software technology is not just a simple document repository. It has applications in many business industries and is used for multiple reasons. Some use virtual data rooms for board communications, while others use them as a virtual workspace. Similarly, millions of businesses and organizations use it for dealmaking such as mergers, acquisitions, fundraising, etc.
Data room providers usually customize their solutions mostly according to the customer’s needs. They also develop tailor-made online data room solutions for specific industries or processes. For example, there are data rooms for real estate, life sciences, private equities, and the legal industry. In simple words, the right electronic data room is the one that has everything you need.
Here is a detailed guide on how to choose online data room software that suits your business.
What factors to consider when selecting virtual data room services
There is no rigidity in the selection process, but considering the following elements will help you discover good options.
1. Consider your needs and objectives
One mistake many businesses or professionals make before choosing a VDR is that they are not sure what they want to achieve with a data room.
Data room software, as mentioned earlier, is a diverse business solution that can cater to multiple needs. Why do you want to use this technology?
You can start with questions like:
- What do you need a virtual data room for? Is it for simple data management? Or do you want it for a virtual workspace?
- Do you need data room software temporarily? How will it affect the overall workflow of your business? Will it make things more efficient?
- Is it just for one department or a team? Who will and will not use the data room?
Questions like these give you clarity on the solution you really need. It is also important to be clear about your budget.
2. Identify the required features
Once you know why you need a virtual data room, you will be able to determine the required VDR features easily. If you intend to make it your virtual workspace, make sure you have the necessary security, document management, and communication tools.
Apart from usage-specific features, make sure you do not miss the below-mentioned features:
- Security features such as two-factor authorization or multi-step verification, document access control, view-only mode, customizable NDAs, device purging, audit logs, and digital watermarks
- Document management features like drag-and-drop, bulk upload, file tracking, smart search or full-text search, file indexing, etc.
- Communication tools like Q&A modules, chat messenger, audio and video calling tools, annotation tools, and many other similar features
3. Compare virtual data rooms
Data room comparison is important as it helps you to discover better options at lower prices. Sometimes you may get additional useful features within your specified budget.
First, look for the features you want to have in your data room software. Second, consider the following elements in the data room comparison:
- Data room pricing models
- Ease of use
- Customer intuitiveness
- Customer support service
- Online customer reviews
A good and responsive customer support service is also a must-have feature. It will make sure your issues are resolved in a timely manner. Also, read customer reviews from trusted sources like G2, Capterra, TrustRadius, and Software Advice. These will specify pros and cons of some of the best data room providers.
4. Do research on data room providers
When you prepare a list of potential data room solutions, do your research on respective data room vendors. Start your research with certifications held by the data room providers. Most importantly, look out for your industry-related compliance or certifications.
For example, financial institutions must look for FINRA compliance, while HIPAA compliance is mandatory for the health sector VDRs. ISO certifications such as ISO 27018, 27001, etc., are mandatory cybersecurity certifications.
In addition to that, it is important to know how long those virtual data room providers have been in the industry — experience matters. You can arrange interviews with different vendors and get more information about their services.
5. Ask for free trials
The good thing is that many virtual data room providers allow free trials. Some of them even offer extended trials for up to 30 days or even 60 days upon request.
Free trials are the best way to get an authentic experience of the given data room solution. You can assess things like uptime, customer support, ease of use, etc.
Following are some of the best virtual data room providers for overall usage:
- Google Workspace
An expensive virtual data room doesn’t guarantee the desired results. The best way to choose the right data room software is by identifying your needs, setting a budget, exploring different options, comparing different data rooms, and asking for free trials.