Chances are, you have heard about Virtual Data Rooms (VDRs) by now and how efficient they are in safely storing and sharing data virtually. But do you know the history of virtual data rooms and why they have become so popular in recent years?
Let’s go way back to where it all started and look at a few reasons why you need to invest in a Virtual Data Room for your company or business.
VDRs or deal rooms are protected virtual spaces that can be used for storing and distributing data.
A Virtual Data Room will come in handy if you are in the process of starting a merger or acquisition, or if you are working on a joint project or a partnership that will require access to shared data.
The History of Virtual Data Rooms
Data rooms have been the cornerstone of financial transactions since time immemorial. According to documented history, the first physical data room was created during the great merger movement which occurred in the 19th century.
During this season established companies realized the value of having physical data rooms where they could store sensitive company information securely.
Strict rules were made in advance and the authorized parties were allowed to access the data rooms by appointment only and no photocopies or photos were allowed.
As much as physical data rooms were a step in the right direction, there were still many difficulties and risks.
For example, for the authorized parties to access the information, some had to travel long distances to arrive at the single location where the data room was located. Plus, there was always the risk of theft or fire destroying the stored documents.
These challenges are what necessitated the need for more secure solutions to store and share sensitive data. According to SterlingVDR, VDRs slowly started replacing the physical data rooms in the year 2000.
In the year 2006, Google presented the concept of cloud computing during a conference that was attended by a large audience. On the 7th of April 2008, the Google cloud platform was launched.
Other companies such as Microsoft IBM and Amazon followed suit and this marked the beginning of secure and fast sharing of sensitive documents.
The truth is, that the transition from physical data rooms to virtual data rooms did not happen overnight. The challenges were many and they included the need for better speed and improved security.
Today, advanced VDR solutions are available to suit all your company’s needs. If you are looking for a VDR for a merger and acquisition, a company such as Firmex comes in highly rated as they offer award-winning, 24/7/365 expert support to their clientele.
Why Have VDRs Become So Popular?
Virtual data rooms are applicable in so many industries including banking, biotechnology and pharmaceutical, oil and gas, real estate, and legal among others. You can use a VDR when working on a joint venture where parties need access to shared data.
However, many companies use VDRs for mergers and acquisitions.
The reason why VDRs have become so popular is that mergers and acquisitions require large amounts of data and most of this data is very confidential and sensitive.
By using a VDR, a company can ensure that all the interested parties get to view the data and engage in negotiations in a safe and secure environment without having to leave their current location.