A professional virtual data room provider should follow a fairly standard structure route to prepare all parties to plan ahead for a smooth process. These Step by Step processes ensures a better coordination and a smooth run of your transaction from the start to end with no hiccups.
1) Designing the Data Room Structure
The life cycle begins with setting up the structure needed to accommodate the requirements of the deal. This is typically done during the Kick-Off Call, which is a working session that takes place between the client company’s Deal Team and the service provider’s Deal Coordinator. During this session project details such as the nature of the transaction and the scope are disclosed.
The team identifies the people authorised to make administrative changes, such as:
– Adding or deleting users
– Handling data room queries using Question and Answer facility
– Other topics under discussion during the Kick-Off Call are the data room’s index structure and the various levels of access that are granted to participants.
2) Training the Deal Team for Data Room use
To manage the data room effectively for the duration of the deal life cycle, it’s imperative that all participants receive training on the tools available. While most virtual data room providers provide full project management resources for clients, project-training the client’s Deal Team offers some significant benefits. These include:
– Improved team members’ understanding of the capabilities of the technology; and– helping to encourage clients’ use of options such as customized interfaces and features.
This makes the difference between using the data room as a repository for documents and getting the full benefit of the options available.
3) Managing Documentation and Permissions
Probably the most exhaustive aspect of the deal’s data room lifecycle, effective management of the documentation is vital to the success of the deal. Data and information is handed over to the service provider’s project management crew, either on a portable drive or via an FTP, or uploaded directly by the client’s Deal Team.
Folders and documents are organized according to the client’s indexing requirements outlined during the Kick-Off Call, and levels of access are assigned to the user list provided. Permissions range from the authority to view a document through to options to edit, download and print. In most cases, users may not have the authority to duplicate or save an external copy of a sensitive document. Most data rooms have efficient version controls in place that provide an audit trail of activity and changes.
4) Controlling Quality and Launching the Deal
It’s vital to verify the setup before the deal is launched in the data room to ensure that there are no errors in folder structure or permissions. The Deal Team and the Project Coordinators need to work together to ensure that the setup is correct, and the accepted protocol is to physically recreate the external environment by logging in as various users. Once everyone agrees that the quality check is complete, invitations can be sent to external parties and the deal effectively becomes live.
5) Closing the Project
At the end of the project, the data room is closed. Final documents are shared for comment and the transaction is archived. The facility offers a secure backup storage facility for all data relating to the deal known as the “Deal Bible”, which authorized users can access for reference/compliance purposes.
By following these best practices during the lifecycle of the deal – regardless of its sensitivity – data room providers and clients alike ensure the optimum benefit from their use of technology during a deal.
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