A virtual dataroom is an online platform that allows for secure storage and sharing of files and documents. Access is restricted to authorized users via the internet. Users must first register with the data room, and then login using their password. They must also accept the terms of service and security settings. There are a variety of features users can make use of to make their online data room more efficient like searching, uploading of files reports, Q&A, and more.

A virtual data room is most often utilized in M&A deals as well as other due diligence processes. It lets companies communicate confidential documents to potential buyers and advisors securely, quickly and efficiently. This reduces time-to-market and the possibility of deal collapse.

Virtual data rooms are also employed for fundraising, the initial public offering (IPOs) or for legal processes. They can also be used to communicate with external stakeholders or to conduct an audit. They can be used by teams of individuals and by multiple parties at the same time and offer the flexibility to work on multiple tasks at the same time. They are also accessible on mobile devices. Many VDRs also have an extensive activity tracker, so users can determine which documents were viewed and for the length of time. This information is beneficial for M&A due-diligence as well as other business transactions. Many VDRs also have a Q&A area that lets users ask questions and receive answers from experts.