Best data room providers 2021
Comparing the major virtual data room vendors in virtual data room reviews does not have to become a simple check of the cost of one virtual data room solution compared to another. There are dozens of factors that influence our decision: the number of users of the virtual data room, the contract length, the amount of data that will be uploaded, the list of business-critical features, to name a few.
So how do we understand which provider offers the best deal? The key is to understand the variety of features present in solutions by top virtual data room providers and then determine which is best for your business needs.
But by taking a close look at virtual data room offers from top virtual data room providers, we offer some advice to help you find the best value. This website goes deep down into the details to show you which virtual data room providers have the best balance between the choice of secure file sharing features and their pricing plans in this virtual data room comparison.
At first glance, all online data room providers look rather similar. They all have pretty much the same features, offers, and approaches. Although, when you take a closer look, you can see that there are differences between them. Therefore, to choose the best virtual data room for your needs, you have to invest some time into the research.
Electronic data room providers have different origins – and that’s the factor that significantly impacts the software in terms of versatility and agility. Also, while some of them try to cover every business process that involves documents, others prefer to focus only on certain kinds of deals and industries. It influences the set of features a specific provider offers.
So before jumping to the research, you first should determine your needs and understand what will you use the data room for. And then you can go through our reviews on this website to find the correct instrument for your firm. We’ve laid out all the features of the best virtual data room providers so that you can go through them quickly and find what fits you.
Virtual data room use and functionality
Virtual data rooms are used across multiple industries by various sized businesses to ensure effective and secure document sharing. Virtual data rooms provide a collaborative platform for multiple parties to share, access, and review confidential documents securely. Depending on the specifics of a business or a project, VDR functionality can be tailored to meet the customers’ needs.
Most VDRs provide high data and access security. However, the most comprehensive security certification to look for is ISO/IEC 27001:2013 certification — a leading international information security standard. Recently, some virtual data room vendors started getting an additional certification for personal data security for cloud services — ISO/IEC 27018. However, the overarching management standard is still ISO/IEC 27001:2013. Having this standard certification is proof that the provider is trustworthy and safeguards customer data.
A standard data room should have the following functionality:
- High data security standards
- Instant access regardless of location/time/device
- Extensive data management functions
- User management and access security
- Reporting and analytics
- Customization options
What to consider when choosing a virtual data room provider?
With technology entering most industries and digitalization becoming a must for effective business operations, selecting the best virtual data room provider can be an overwhelming task.
The global VDR market is saturated with many digital data room vendors, all claiming to be the best virtual data room providers. The most important aspects to consider when choosing a virtual data room software is the providers’ experience, security certifications, expertise in the industry where your company belongs, and their pricing approach.
1. Software provider experience
When reviewing a VDR provider, look up their previous and existing clients. Look for companies you can trust. Pay attention to what business fields they represented the most and whether they had a good experience given the industry specifics. A lot of data room vendors showcase their clients on their websites, highlighting reviews from the most popular companies. Also, compare VDR ratings. There are some trusted review sites worth checking out offering top data room provider ratings. Ratings are typically given for software overall performance as well as in categories such as functionality, ease of use, support, availability, pricing, among others.
2. Compliance with data security certifications
Check whether the VDR service provider has been audited by ISO/IEC 27001:2013 Certified Data Centres or SOC 1 or SOC2 (Type I, Type II) Certified Data Centres. Also, take account of additional data processing terms as required under GDPR, for example, the obligation to secure protections from any subprocessor. If relevant for your business, check whether the VDR provider has compliance with HIPAA (Health Insurance Portability and Accountability Act) and sets the standard for sensitive patient data protection.
3. Expertise in your industry
A lot of VDR providers tailor the functionality of their software to the needs of a specific industry or use case, for example, M&A due diligence, legal operations, or real estate. By making sure your selected provider has experience in your industry, you can be sure of a successful and smooth transition to a digital data platform. Of course, some vendors claim to be suitable for any industry, offering different platform templates based on the type of project you will have. A software specialized for a particular business field, however, offers more guarantees that your individual needs will be met.
4. Pricing approach
Price is one of the main factors companies consider when choosing an online data room, but it should not be the deciding factor. Keep in mind that most data room providers offer a wide array of plans to choose from and with some of the most advanced features include in the more expensive plans.
Depending on the duration of the deal, the number of users, and the required storage volume, it is necessary to compare different pricing plans. Costs vary drastically among providers. Some virtual data room service providers offer flat rate pricing — a monthly fee that includes unlimited storage, users, data, etc. This option is budget-friendly and prevents any surprises regarding VDR expenses. Some vendors also offer flexible billing — monthly, quarterly, or annually — with additional discounts when choosing a longer-term plan.
As you can see, even though we’ve picked only the best data room providers, there are still many of them. That’s why you should start with understanding why do you need the online deal room for. What kinds of deals will you hold using it? Which functions do you need to feel comfortable maintaining your corporate documents? How often will you use it?
Once you answer these questions, it will be easier to determine your requirements and realize what you’re looking for. Another thing you should do is to figure out your budget. Virtual data room providers set different prices for their services. And sometimes you pay more only for the well-known brand while the software itself is fairly mediocre. Therefore, you should know in advance how much money are you ready to spend on the data room. It will help you to instantly drop options that are too expensive so that you don’t overpay.
Then you can go through features different providers offer and pick the options that suit your requirements the most. At this point, you want to consider additional criteria. First of all, we advise you to prefer the providers that offer a free trial. It will help you to test the software and see on practice if it fits your business. Pay attention to the interface – how easy is it to use, how well are the features organized. You want to get the software that won’t require any training.
Guidelines for choosing a virtual data room software
With technology being used by most industries and digitalization becoming a must for effective business operations, selecting the best virtual data room provider can be an overwhelming task. The global VDR market is saturated with many digital data room vendors, all claiming to be the best virtual data room providers.
Follow these steps to successfully choose, set up, and start benefiting from a secure virtual data room:
Step 1. Determine your needs and prioritize necessary functionalities
Given the specifics of your business (M&A due diligence, real estate transactions, investment banking, etc.), you have to be clear how you will use the VDR and how your company will benefit from using it.
List your companies’ and user’s needs. For example:
- must have specific security compliance such as ISO/IEC 27001:2013 or SOC 1(SSAE 16, ISAE 3402)
- must provide specific document security features (watermarking, restricted viewing, two-factor authentication, etc.)
- must provide access to a full audit trail and user activity log
- must offer document encryption and revoking access after download
- must have a mobile-friendly user interface for Android and iOS
In case you are working with a tight budget, prioritize the functionality to be clear which features are necessary and which ones would be “nice to have” but are not crucial for your operations.
Step 2. Determine your budget
The market has many high-priced data room service providers for large companies executing massive deals, but a lot of affordable options for smaller businesses or niche industries are available too. Setting a budget or a price range will help you narrow down your search.
Pricing plans typically depend on how much storage you will need, how many team members will be using the software, what features your company desires, and how high the security level you need. Some virtual data room service providers also offer flat rate pricing — a monthly fee that includes unlimited storage, users, data, etc. This option is beneficial for keeping track of your monthly VDR expenses.
Step 3. Compare virtual data rooms and evaluate offers
Once you have narrowed down virtual data room provider offers, compare and evaluate whether their software meets your needs. Look up virtual data room reviews and user experiences. Be aware that there are a lot of fake reviews on the Internet. Most trustworthy would be actual customer reviews from your peers, business partners, or people you trust. Some companies list the biggest clients on their websites. It can be a good indicator of what type of industry leaders have chosen their services and whether you would like to do the same.
Pay attention to what market segments your chosen VDR data room was originally intended for. Some are specifically designed for M&A due diligence and work best specifically for virtual deal rooms and M&A processes. Others might be suitable for different industries, while some electronic data room providers claim to be a one-stop-shop for any business.
Step 4. Test a couple of software providers
It is a good idea to test a couple of choices to get a good feel of the software before committing to a plan. Check which providers are offering a free trial version or connect with their support to ask for an opportunity to test their product. When getting in touch with their experts, be sure to take time to ask additional questions, double-check the price , and tell them about your business specifics. While testing the software, evaluate the user interface, functionality, design, and ease of use for you and your team.
Finally, make an informed decision and choose the provider that checks all or most of your boxes.
Tips for choosing data room software
If your project is very complex, you may need these advanced features in order to make life simpler for you and everybody involved in the project. The last thing you want to do is save on critically important features since it will end up costing more in the end. Also, be sure to verify that your pricing plan is flexible. If your project expands, you will need more space to store your documents and if you choose the cheaper plan, you may be stuck with it.
If your project requires strict confidentiality, then an online data room will be simply indispensable. When you take an initial look at certain data room providers out there, they seem to be offering very similar services, but, in reality, some of them really cut corners as far as security and usability are concerned. While conducting your search, you need to take into account that no two virtual data rooms are the same and some will be useful for certain types of projects such as due diligence and M&A transactions, while others will be useful for things such as case studies and document repositories.
Whenever you log into a data room for the first time, it can be hard to figure where everything is. In fact, you may need help with simple things such as uploading or viewing documents. If this happens, will their support team be there for you whenever you need them or will they be there during certain hours? Also, you may need help in a language other than English. Will support be available to you in this situation?
These are just some of the aspects that you need to consider when making your choice since making a mistake at this stage can be very costly. Take the time to figure out your specific needs and discuss them with the data room provider. Everything else will fall into place.
Benefits of online data room software
Unlike generic cloud storage, virtual data room providers take care of the security of user information. They use the most reliable 256-bit encryption to protect both the storage and data transfer ways leaving hackers zero chances to access the stored documents. Additional safety features like two-factor authentication, watermarks, different levels of access, and other tools allow users to enhance the protection even more. Also, these functions give customers control over invited users and their activity in the data room.
The best data room providers make their software compatible with all devices and platforms. Some of them make it happen to create mobile apps, and some simply offer mobile versions users can access via browsers. But regardless of which way do they choose, customers can enter the data room from anywhere at any moment. It helps to significantly accelerate the deal and make sure that everyone can work with documents even if some participants are on the road.
Having access to the support team is vital because sometimes you need urgent help. Otherwise, the deal is stuck. The best VDR providers offer support teams that are available 24/7/365 so that users will never feel frustrated or lost. So if you face any issue, you can get help instantly so that the problem doesn’t harm the work. Many vendors even provide their customers with a dedicated project manager that will go through the deal along with the users to help them get the most out of the virtual data room.
Virtual data room services
Comparing online data room providers is complicated. It is not the case where you make a cheek-to-cheek comparison because virtual data room providers offer different pricing plans, unique features, and data management tools, and frequently add new features.
- Reporting and Audit. Each user action in the virtual data room is thoroughly recorded and can be examined for useful business insight, for example, to gauge user interest in a particular document or folder. VDR provides a complete audited trail of actions which is essential for highly regulated industries with strict compliance requirements.
- Gradual Access Control. The data room owner can set a detailed structure of permissions that outline what each user or user group can do in the data room, for example, view in full or in restricted mode, print, save or share the documents. Access rights can be revoked even retrospectively, but not many of the data room providers have this function.
- Ease of Data Access. Most top-grade data rooms can be accessed on a variety of devices, including mobile, and work equally well on all common platforms. The intuitive interface improves user acceptance and eliminates the learning curve so even the least technical of dataroom software users can start working in the VDR straight away.
- Secure File Sharing. Data rooms are specifically created for companies who need a controlled, permission-based medium to share sensitive, confidential, or intellectual property data. Relying on these precious types of data on consumer-grade file sharing solutions would be a grave mistake. Watermarking, permission-based file sharing, and document rights revocation help to secure file sharing in the virtual data room.
- Collaboration Tools. This set of features permit users to collaborate with others on a specific document or folder in the data room. Some collaboration features such as Q&A and secured email can only be found in top- grade data room platforms. Many users rely on the ability to discuss and comment on the data they are working on.
- Multi-layered Security. Data security is imperative for virtual data rooms and top VDR providers employ a number of highly advanced security technologies, including encryption, multi-level user authentication protocols, and post-dated access revocation. Document security features usually include customizable watermarking, printing disability, and view restriction.
Setting up your VDR
To ensure a smooth transition to your new VDR, consider following these steps:
- Gather all the necessary data and follow a specific file naming system
- Have a clear vision and create the internal structure of your VDR (use folders, subfolders, access levels, categories, etc.)
- Upload all files (VDRs typically have an automatic index numbering that numbers folders and documents sequentially as they are uploaded)
- Create groups of users, set access permissions
- Double-check everything and test functionality
- Invite team members to begin work
- If necessary, seek training for your team
Data room use cases
Virtual data room services are used for various business deals and processes. Here are a couple of examples.
M&A due diligence
Virtual data rooms for Mergers and Acquisitions Due Diligence offer an opportunity to create a Due Diligence Data Room online and replace the physical deal room securing all sensitive legal, financial, sales, marketing, and human resources documents in one central, virtual place
Real estate transactions
Online data room assists real estate transactions with keeping all documents, such as building construction plans and data, NOCs, insurance, mortgage documents, land register entries, contract of sale, etc., in a safe environment for all involved parties to access.
Fundraising / capital raising
When managing a deal with potential investors, it is necessary to disclose confidential information. VDR provides a safe way to do it while protecting companies’ intellectual property.
Investment bankers use VDR software to share information with qualified buyers. Ability to view who has accessed the files, for how long, and what exact pages, are of particular benefit to investment bankers.
Some data rooms are specifically equipped for the IPO preparation process. VDR helps efficiently share large volumes of documentation with potential share buyers. As going public is a very time-consuming and stressful process, a company must remain transparent, consistent and share necessary information promptly. VDR is a perfect tool for that.
Licensing / legal document management
A virtual data room can help a law firm and its customers communicate in a secure virtual environment. VDR allows both parties to view, update, sign confidential documents and contracts virtually.
Corporate Repository holds and archives the most sensitive company information. A virtual data room can help distinguish document access and permissions among employees.