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Once a company has convinced an investor that it is now ready to conduct due diligence, the next step is to open up their „data room“. This virtual storage space contains the documents that investors will need to look over and helps the company organize them in a manner that makes them easy to find and understand.

Virtual data rooms are the most frequent method to carry out this process online. Traditionally, it was done in a physical space. The concept behind them is that they provide security for businesses by providing a secure space where they can keep confidential information and control who has access to what.

This means that companies only pay for the software required and can save money by not hiring security staff to monitor a physical space. There are many providers of virtual data rooms, which vary in terms of features and pricing therefore it is essential to investigate and choose a provider that best suits the needs of a company.

Some provide a simple option for document management, while others, like iDeals or Citrix provide more advanced features such as multilingual search analytics, data tracking and OCR as well as smart AI categories. After choosing a provider the startup must decide on which documents it wants to include and the organization that is most suitable for the needs of its customers. For instance, organizing financial documents such as legal documents, contracts and other information is essential to allow potential buyers to get the information they require.