What Is a Cloud Data Room?

A cloud data room is a cloud solution specifically designed for the storage and sharing of confidential business information in a secure setting. They are used to support due diligence in M&A deals, IPOs, and legal proceedings but can be used in any situation needing the secure and efficient handling of sensitive documentation.

Virtual data rooms are highly elastic and can be accessed using an internet connection. Data stored in the cloud unlike traditional desktops, laptops and servers, is protected by multiple layers security. That includes firewalls, encrypted transmissions, and multiple backups to prevent any accidental or malicious data loss.

A virtual data room includes a range of features which support the processes dealmakers manage. They include a Q&A section and advanced permission controls as well as bookmarks and notes and detailed monitoring of activity. They also provide a much higher level of customer support than traditional cloud storage solutions as many providers provide in-app, phone, and email multilingual support, as well as dedicated teams and managers.

To locate a reputable cloud data room provider, it’s worth checking whether they have SOC 2 certification and ISO 27001 accreditation. This is an independent audit that assesses the capacity of a cloud service to guard against threats to your sensitive data and ensures that they are in compliance with internationally recognised best practices.


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