Handling an M&A requires a lot of communication in order to discuss all of the various processes that will take place and how the transaction itself will be implemented. If you use a data room to make the deal, it will simplify a lot of processes for you and will enable you to get the deal done within the established time period. You will be able to save a lot of time and resources by not having to physically travel to a specific location since the data room will allow you to work as if you are in the same room.
Lots of companies have chosen to use a data room since it mitigates the risk of legal action that may result due to inadequate security standards. Given all of the new cyber threats that emerge nowadays, it can be hard to keep up. Therefore, it is better to leave the protection and security of your documents to the data room so that you can focus on your core business functions. Let’s take a look at all of the many ways that virtual data rooms can make your M&A activities smooth sailing, despite all of the hurdles that must be overcome during the process.
Using Data Rooms for M&A Deals Management
It is just solid organizational practice to keep all of your correspondences and documents in a single location. This will eliminate a lot of headaches and wasted time down the road. The Q&A modules inside data rooms allow all participants to ask questions or make comments about a particular document. If you need to have a discussion about something, this can also happen in real-time inside the data room. Some of the more advanced Q&A modules will offer additional benefits such as the ability to set question status. This way you will not have to keep asking whether or not a question was answered since everybody will see what the status is. Furthermore, the data room can come up with a Q&A sheet which will eliminate redundant questions altogether.
In today’s business environment, corporate espionage is very much real and while many business leaders are worried about external threats such as hackers, they often forget that the biggest threat could come from within. The data room will give you peace of mind in this regard as well since you can set granular access permissions. You will have full control over who gets to see which information. One of the more innovative features found in some data rooms is secure spreadsheet viewing. For example, let’s say you would like to participants to be able to see all of the data inside an Excel spreadsheet, but you do not want them to see the formulas that are contained below the surface. You will be able to set the access permissions in such a way to determine who gets to see this information and who does not.
Also, an interesting and innovative feature found inside some data rooms is “Fence View”. It serves as a physical barrier between the document and the user, which is very effective for protecting data against camera based attacks. After all, if someone is bent on stealing a certain piece of information, simply taking a picture of the computer screen will not be an issue.
If you are worried about external security threats, your fears can be put to rest since pretty much all data rooms are must comply with international certification standards such as ISO/IEC 27001:2013, SOC, HIPPA and other standards. In the event of an information leak, you will always be able to shred the document remotely.
If you currently use a cloud service such as Dropbox or Google Drive to store your documents, you are most likely spending a lot of time searching for documents, requesting the needed documents to be sent to you and then waiting some more for the owner of the document to give you access. Such time wasters can be avoided since a data room will offer full-text search and the bets one will even offer optical character recognition (OCR). This way if there is a handwritten note or document, the system will be able to find it as well.
All of your documents can be uploaded into the data room in bulk and all of your documents will be indexed and numbered for easy access. After the project is over, the contents of the data room can be downloaded to a DVD or a flash drive and it will be kept on the provider’s system for a certain amount of time. This way if you need to go back and revisit something or restart the project everything will be there just the way you left and you will not have to start over again. Your investment in the virtual data room can pay huge dividends even after the project is over. You will be able to use the data room as a central document repository which has enough storage for all of your documents, video presentations and any other information you need to be store all in one location.
Conducting an M&A transaction can be difficult without all of the security threats and time wasters that appear over the course of the project. Even if a certain process requires a few extra clicks or seconds, all of this will add up and, before you know it, you wasted a half an hour over even more. Therefore, it is better to use a data room to get organized and have all of the documents you need available to you whenever you need them and have peace of mind knowing that all of your information is secure. All of the features are designed to get your deal done on time with maximum efficiency.