What is a Secure Data Room?


Secure dataroom is an online collaboration platform that streamlines due-diligence, shortens timelines for M&A and deal-making while providing ironclad safety. It enables buy-side and sell-side teams to handle the full process from beginning to end with confidence.

What is it that separates a secure dataroom from file-sharing sites like Dropbox is the fact that it’s more geared toward the enterprise with the ability for users to be organized and permissions to be granted at granular levels. Analytics can also provide insight into the usage (e.g. the time, date and location your data is being used). Many have advanced features, such as the ability to prevent copying and downloads (a big no-no) or the ability to display documents in a way that can’t be scanned. Many of them use industry-leading encryption technology to encrypt sensitive information and use multi-factor authentication to make sure it’s actually the user trying to login who is requesting access to the data.

Most secure datarooms permit users to download documents in PDF format to view offline. But, if users print these files to physical printers or allow them to save them to file drivers for different purposes, they are not protected by the same protection that is provided to the original data in the virtual data room.

If you are able to extract the downloaded files from the data room or other systems, and then browse them on your computer without being connected to the Internet that defeats the entire reason for using an encrypted data room for M&A due diligence compliance, litigation, and other sensitive documents that need to be secured to devices and not transferring to servers. This is why we suggest using a DRM system that locks documents to devices instead of to servers which makes it impossible for you to extract them from devices or share them with others.

Leave a Reply

Your email address will not be published.