Virtual Datarooms have changed a lot in the last 10 years. From rarity to almost commodity. Something that was very complicated now seems much easier with the wide availability of file sharing and also the creation of cheap providers that define themselves as datarooms.
We have spoken quite a lot about how to really separate real VDR secure providers from riskier solutions but we have spoken less about service. Separating real, secure providers of virtual data rooms from a multitude of providers who define themselves as data room solutions isn’t easy.
It’s not just about the technology, however; if virtual data rooms are to survive as a real business and have a future then providers need to offer unsurpassed service at the same time. Not as an after-thought or “optional extra,” but as part of the base offering and included in the price. In a typical M&A transaction, everyone is pressed for time and resources, and a provider that offers a professional data room coordinator to perform the legwork for the client can have a significant competitive advantage over another.
Francisco Lorca, CEO of EthosData rightly says – “We do not deliver a technology solution, we provide a full virtual data room service. Our goal is to provide the service that we would demand if we were conducting an M&A transaction, reporting to our investors, sharing information with our Board of Directors. Technology is just a part of the equation. We invest as much time and effort recruiting and developing talented Deal Coordinators and professionals as in developing our dataroom platform”
Tasks and Functionality
Over the past decade, virtual data rooms have gone from being a rarity to almost becoming an essential for all types of secure document exchange transactions. In the past, corporate sellers set up physical data rooms where buyers and advisers would sift through the information available.
Today, it has become commonplace for companies to prefer a virtual resource, Most people doing an M&A transaction value time over anything. When executing an M&A transaction, organizations are usually stretched for time and resources and everything becomes urgent and tense. A real VDR service provider should do all the work related to the managing a dataroom allowing clients to focus more on the due diligence process
The type of services supplied by providers of reputable virtual data rooms are more than simply offering technical support or a ticket system for use to resolve problems. Real client services include:
- Setting up the infrastructure according to the client’s requirements
- Scanning in the documentation in a secure, confidential environment
- Creating a logical indexing system
- Establishing user access permissions and login procedures
- Setting up report templates to fit the client’s needs
- Facilitating the handling of questions and answers between the parties
A good data room provider also follows up regularly with the client to ensure that all is going well and that the client is satisfied.The deal coordinators, as we like to call them in EthosData, will draw from the firm’s deep experience and make the process easy taking the task of managing documents away from clients and eliminating the need for bankers or lawyers to administer the process.
Benefits
The advantages of using providers of virtual data rooms that offer this kind of service include using the best practices in managing passwords, training the deal teams to use the data room and closing the project after the deal is complete. Additional benefits are:
- Better exposure to long-distance bidders
- Assessment of the buyers’ level of interest based on statistics and reports, and
- The customization of access rights.
Document security is also vitally important, and reputable providers ensure that their technological and human processes are geared towards maintaining the highest possible protection for your confidential and sensitive data.
Not all Data Rooms are Equal
What it comes down to is this: Anyone can offer you space for storing your documents in the Cloud. What you need to evaluate, however, is whether the vendor you choose is reliable and organized enough to give you the service you need to accompany the storage space. Not all data rooms are created equal, and your choice of a vendor can determine the success- or failure – of your transaction.
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