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How to Use a Data Room During Due Diligence

Due diligence is a key stage of a business deal. It allows both parties make informed decisions. In this phase it is vital to store all the necessary documents in a safe location to make it easy to access. This is the reason why a virtual data room can be useful. It helps businesses reduce time, increase productivity, and improve internal transparency. It allows you to keep track of every action and set permissions, in addition to making sure your data is protected. The most appealing aspect is without hidden costs or costly hardware.

The first step towards a successful due-diligence is deciding what documents are required to complete the project. Once you have your list of documents in order, it’s time to select a virtual dataroom provider that will meet your needs. Most reputable vendors offer a no-cost trial of the software that can last up to a month. Make use of this time to conduct mock-ups of the key due diligence procedures to get an idea of how each tool will perform for your business.

The organization of your data in your virtual data space for proper diligence is the next step. It requires creating a clear file structure that matches the timeline of your future collaboration. Divide the files based on type of information, departmental level of confidentiality, and the stage of the project. Use name conventions for files to help users quickly locate the right document.

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