Starting a new business, expanding a current business, or launching a new megaproject requires funding. For this, companies and entrepreneurs turn to investors or investment companies.
However, among other things, the lack of communication due to inappropriate channels and the inability to present business documents to potential investors can have a huge impact on their investment decision and reduce the chances of obtaining the necessary funds.
One way to ensure smooth communication with your potential investors is to use virtual data rooms. Online data room software not only provides a secure platform for real-time communication, but makes sharing data safer during fundraising.
What is online data room software?
Online or electronic data room software is a secure digital document storage platform with advanced tools for business communication and project management tools.
In broader terms, data rooms are cloud-based data repositories hosted by certified online data room service providers. Businesses of any type or size can use data room software for centralized data storage and fast data sharing.
Virtual data rooms are different from other online data storage platforms because of their built-in communication tools. This means that a company does not need different solutions for data management and intra-organizational or inter-organizational communication.
Finally, the online data room software has project management tools to deal with the complexity of business activities such as investment management, fundraising, capital raising, IPOs, real estate portfolio management, etc.
If you want more information on data rooms, their reviews and uses in the market, go to virtualdata-rooms.com.
The Best Virtual Data Rooms for Fundraising and Investment Management
Fundraising is not a generic use case for virtual data rooms. Businesses and fundraisers use specialized data room services for fundraising, and here are some of the best data room providers on the market.
1. iDeals Virtual Data Rooms
iDeals Solutions is one of the oldest and biggest names in the data room industry. As an industry leader, iDeals can outperform any competitor in data management, document security, project management and flawless online communication.
iDeals tops the list because it’s not only great for fundraising, but you can also use it for general data storage, project management, legal, mergers and acquisitions, due diligence, and IPOs.
Most importantly, iDeals has an unparalleled customer support service, which can guide you every step of the way. The company also offers free trials.
If you are looking for a secure, simple and easily affordable virtual data room for fundraising, managing corporate documents, closing deals and more secure communication, SecureDocs data rooms can be a very reliable option.
SecureDocs allows you to add an unlimited number of users to your data room and the setup process only takes 10 minutes. Their basic plan starts from $250 per month which is very affordable even for startups and small businesses.
When it comes to managing complex transactions such as fundraisings, divestitures, mergers, acquisitions or capital raises, Ansarada virtual data rooms are an option you should definitely consider.
Ansarada has already made a name for itself in the corporate sector thanks to its project management tools and a very strong data security system. The company also offers a 14-day free trial period that can help you determine whether or not you need their data room services.
Any award-winning virtual data room solution, Digify is perfectly suited for due diligence, fundraising, intellectual property protection, and safer data sharing.
Digify offers a wide range of very useful features such as digital watermarking, document download and print permissions, file tracking, advanced data encryption and document access control.
FirmRoom’s VDRs are specifically designed for the financial industry to facilitate processes such as due diligence, mergers, acquisitions, fundraising, partnerships, joint ventures, and private equity acquisitions.
FirmRoom simplifies data management and file sharing processes with optimal security. Key features include user activity tracking, file tracking, bulk file upload, bulk user invitations, custom notifications, audit trails, and data analytics.
How do virtual data rooms help with fundraising?
Virtual data rooms reduce communication barriers, facilitate seamless sharing of data, and ensure transparency when raising funds. Here’s how.
Centralized data storage and sharing
As cloud-based online platforms, virtual data rooms allow fundraisers to upload and file all necessary documents in one place. The good thing is that high-end virtual data rooms provide a fundraising due diligence checklist, which ensures that fundraisers have filed the documents in the correct order.
As the VDRs are accessible remotely, potential investors or their representatives can easily access the required documents from anywhere. They can ask management to grant access to restricted documents if necessary. Data sharing can take place in real time and hundreds of documents can be shared at once.
Centralized, controlled and traceable communication is now possible using data rooms. Fundraisers, investors, corporate representatives, advisors and other relevant parties may involve real-time communication via various channels such as audio or video conferencing, Q&A, document annotations and live chat threads.
One of the best things about online data room software is that it allows you to track all the activities that take place there. Detailed audit logs can be generated to track data room user activities, leaving no room for foul play. When everyone is trackable on the VDRs, everyone can be held accountable for their actions.
In the fast-paced modern world, investors want to invest quickly, but at the same time they want their investments to be safe. Slow communication and barriers to sharing data during fundraising can minimize the chances of fundraising success, and this impacts investment decisions on the side of investors. Using virtual data rooms can remove these barriers and help companies run successful fundraising campaigns.
This article does not necessarily reflect the views of the editors or management of EconoTimes