A data room can be a great source of private information on oil fields, but it can only be used for a short time. This is the reason why the industry requires a device that can ease the burden of due diligence. Traditionally teams of buyers go to datarooms physically to review the documents, copy them and interpret them deposited by sellers.
This method exposes documents to wear and tear and leaves them vulnerable to alterations that are accidental or deliberate. It’s also not possible for the sellers of the documents to know who has viewed which version. A virtual data room, however provides access to all users worldwide and doesn’t carry the same risk.
When selecting a VDR provider, look for basic and advanced tools to streamline due diligence processes. Make sure the tool you choose matches the requirements of your company, and that it has a folder structure that is easy to navigate. Also, take a look at the feedback of users on review platforms that are independent.
The effectiveness of the data room is dependent on various factors such as the size of the business and the amount of documents the company uploads to the VDR. A basic data room with the required features might suffice for smaller businesses. For larger enterprises however, more advanced tools are required to manage and protect data. In addition, they need to examine the VDR functionality in the context of their overall M&A goals and make sure that it can support those goals from both tools and systems perspectives.