What Is a Cloud Data Room?

A cloud data room is a cloud service specifically designed to facilitate the storage and sharing of confidential business information in a secure and safe environment. They are used to support due-diligence during M&A deals, IPOs, and legal proceedings, but they can also be utilized in any situation that requires the safe and efficient handling of sensitive documents.

As with any other cloud-based program such as a virtual data room, it is highly scalable and easy to access. All you need is an internet connection. But unlike traditional laptops, desktops, and servers that can be damaged or stolen from your office, the data stored in the cloud is protected by a variety of security layers. This includes firewalls and encrypted transmissions and multiple backups to avoid any accidental data loss.

A virtual data room includes a range of features that support the processes that dealmakers manage. This includes a Q&A space with advanced permission controls as well as bookmarks and notes. They also offer detailed recording of activities. Many providers offer a higher quality of customer support than traditional cloud storage, including multilingual support via phone, email, and in-app.

It’s important to check whether a cloud-based data room service provider is accredited with ISO 27001 and SOC 2 accreditation. This is an independent audit which determines the capability of a provider to protect sensitive data from security threats and proves that they are in compliance with internationally recognised standards.

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