Virtual Data Room Due Diligence Checklist: What to Consider?

Updated on: May 11, 2022

A virtual data room is software that provides you with a full-fledged work environment where you can securely communicate, exchange data, store corporate information, and more. Thanks to a unique set of tools and advanced settings, modern data rooms are used in almost all types of businesses.

Currently, you can find a large number of offers from different providers on market. They may differ in price and set of additional functions. At the same time, all of them have a standard set of vital tools. You can learn more about different VDRs by following the article. Scroll on to learn more about the main features of a typical VDR and how they help during the due diligence process.

Basic VDR Features

If you make a data room comparison, you can see that they may vary in the set of specific features and tools. But some of them are basic and below you check the out.


This is one of the main features of the virtual data room. Modern companies (especially those dealing with large financial flows or private information) use VDRs. Not only direct financial but also reputational losses of the company depend on the integrity of information. Up-to-date solutions allow you to set access conditions for different files and folders. At the same time, you can invite third parties to examine some pieces of information, and not worry that the data may be unauthorized copied, deleted, or damaged. You can conduct these settings in a few clicks. In addition, most virtual data room providers offer two-factor authentication, advanced encryption with 128 or 256-bit keys, SSL protocols, watermarks, and more.


Modern virtual data rooms allow you to monitor the slightest changes in the system. You can see who logged in and out of the system, the most frequently viewed or downloaded files, and more. This helps better understand the focus of interest of stakeholders. As a result, you can build a business strategy as efficiently as possible.

Artificial Intelligence

Currently, data room software providers try to make the most of the power of artificial intelligence.

Given that large financial transactions are accompanied by large amounts of information, it can be difficult to control the process manually. With the help of artificial intelligence, VDR controls errors and prevents duplication of files. In addition, you can take a benefit from the advanced search for documents, single phrases, or keywords.

Drag and Drop Option

While many programs require you to download files one at a time, online data room software allows you to download files simply by dragging them. In this case, you can do this one at a time or select many files at once. This significantly speeds you up and optimizes the workflow.

Also, many services offer automatic indexing of uploaded files. Subsequently, it helps properly structure data, create categories, groups, and so on.

Collaboration Tools

A modern virtual data room has built-in instant messengers, live chat options, and more. With their help, you can always be in touch with your team and partners. You can create polls, take part in discussions, and more.

A Due Diligence Checklist of Documents VDR Should Contain

Due diligence is a complex process that requires. At every stage, you deal with a lot of different information. Below, you can check the most common files you may face.

Legal documents. They reflect the structure of your company and special constituent documents.

  1. Historical documents. The virtual data rooms store information about the company's activities in the past, data on meetings, transactions, and more. This is important for debugging the company's development strategy and correcting mistakes.
  2. Financial documents. This includes audit documents, tax reports, financial estimates from resolvers and suppliers, data on your profits and losses, and so on. This information is also important for building the reputation and transparency of your company.
  3. Concept papers. These documents contain plans for the development of your business. This data is especially important for partners and potential investors.
  4. Asset documents. These documents store information about your assets, intellectual property, patents, and more.
  5. Personnel documents. The electronic data room can also store data about your colleagues. This helps you keep track of HR issues and keep track of what's going on in your team.
  6. Investment data. This is the most important document that investors pay attention to. There is data on who owns the company, shares of board members, etc.

Differences Between VDR and Cloud Storages

Despite the fact that both types of services are aimed at storing information, there is a significant difference between VDR and regular cloud storage.

  • Reliable access to all resources from anywhere in the world.
  • Ability to scale workflows
  • High level of security due to the fact that information is duplicated and stored on remote servers.
  • High accessibility of data room services, when you don't need to download a .exe file and install a program to access your data.
Saurabh Mukhekar
Saurabh Mukhekar is a Professional Tech Blogger. World Traveler. He is also thinker, maker, life long learner, hybrid developer, edupreneur, mover & shaker. He's captain planet of BlogSaays and seemingly best described in rhyme. Follow Him On Facebook

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